Not upheld: Motor finance commission (DCA) complaint against Clydesdale Financial Services Limited trading as Barclays Partner Finance

Decision detail

Summary

Mrs G purchased timeshare memberships financed by credit agreements with Clydesdale Financial Services Limited (trading as Barclays Partner Finance). She complained that the Fractional Club membership was misrepresented as an investment in breach of the Timeshare Regulations, that the credit relationship was unfair under Section 140A of the CCA, and that commission payments were undisclosed. The ombudsman found no actionable misrepresentation, as while the product included an investment element (share in property proceeds), the evidence did not support that Mrs G's purchases were motivated by investment prospects. The ombudsman applied case law principles that regulatory breaches do not automatically create unfairness and must materially influence the consumer's decision. The commission amounts (8.2% and 2.5%) were not high enough to render the relationship unfair, and the Supplier did not owe a fiduciary duty. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found no factual and material misrepresentation by the Supplier under Section 75. While the Fractional Club included an investment element (share in property), the Timeshare Regulations prohibited marketing it 'as an investment' but not the mere existence of an investment element. The ombudsman found competing evidence on whether it was marketed as an investment but concluded this was not determinative. Critically, the ombudsman found Mrs G's purchases were not motivated by investment prospects, noting the investment issue was only raised in an undated statement years after the initial complaint, suggesting it may have been influenced by subsequent court judgments. The ombudsman applied the principle from case law that regulatory breaches do not automatically create unfairness under Section 140A; such breaches must be considered in the round and must have materially influenced the consumer's decision. The commission amounts (8.2% and 2.5%) were not high enough to render the relationship unfair, particularly given Mrs G wanted the product and had no alternative means to pay. The ombudsman found no fiduciary duty owed by the Supplier as credit broker and no sufficiently extreme inequality of knowledge.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website