3 days ago
Barclays bank has been unsuccessful in its bid to overrule a decision by the Financial Ombudsman Service’s (FOS), which kicked off the motor finance crisis.
The landmark decision, passed in January, sparked the ongoing FCA investigation into the motor finance sector, which has rocked the industry over recent months.
According to the FOS, customer Jenna Lewis had not been made aware that her payment package included a £1,600 commission to a credit broker – in her case the dealer she bought the vehicle from.
The situation was flagged with the Financial Conduct Authority (FCA), which subsequently launched a market-wide inquiry into potentially unfair vehicle loan deals struck before January 2021 – which was when the regulator banned discretionary commission arrangements (DCAs).
Car Dealer reported back in July that Barclays had lodged an application for a judicial review of the case, arguing that the ruling had been based on ‘misinterpretations of the law’.
However, after reviewing the case, Mr Justice Kerr dismissed the challenge ‘on all grounds’.
Despite the setback, Barclays retains the right to appeal and the bank says it will be taking up that option after being left ‘disappointed’ by the latest decision.
A spokesman said: ‘This challenge related to a single, specific case on which we disagreed with the Financial Ombudsman Service’s decision.
‘We are disappointed in the court’s ruling and will be appealing.’
The refusal to overturn the FOS decision is separate from the ongoing legal saga surrounding the Court of Appeal’s ruling against Close Brothers and Firstrand Bank in October.
Close Brothers was last week granted permission by the Supreme Court to appeal the result of that case and a decision is expected in the new year.
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The post Barclays loses bid to overturn landmark Financial Ombudsman Service decision on motor finance appeared first on Car Dealer Magazine.
