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Seems the Regulator has finally jumped on this rogue outfit
General
1. This schedule sets out the terms of the requirements to be imposed on Motormile Finance UK Limited (Motormile) with effect from 13 February 2015.
2. Motormile conducts debt purchase and collection.
3. Information obtained by the FCA about Motormile prior to and following a visit to the firm has given rise to serious concerns in relation to Motormile’s debt purchase and collection practices.
4. In particular, the FCA has concerns that Motormile’s debt purchase and debt collections practices are not compliant with the FCA’s requirements and expectations in several respects. For example, Motormile fails to conduct sufficient due diligence upon the purchase of a debt portfolio to be satisfied that the sums due under customer loan agreements are correct. Motormile then engages in debt collections activities with its customers, including outbound collections activity and legal action, for sums which may not be properly due under the loan agreement.
5. These concerns give rise to an ongoing risk to Motormile’s customers and Motormile has agreed to the following requirements to mitigate that risk.
6. Motormile intends that these requirements will remain in place for such length of time as the FCA reasonably deems necessary, taking into account all relevant matters including any evidence that demonstrates it has addressed all of the FCA’s concerns with its business practices and is conducting its business in compliance with the FCA’s rules and guidance and is treating its customers fairly.
Requirements
7. In respect of all its regulated debt collection accounts (“the Accounts”):
• Motormile will write down all currently held regulated customer debts to 175% of the principal sum paid to the customer due under each loan agreement and no further sum will be collected from the customer. (“The Offer”) Where necessary, Motormile will also take all necessary steps to amend the credit files of customers affected by this write down.
• Prior to active collection attempts being made on any Account, Motormile will notify each Customer in writing of the write down on the Account and inform the customer of the resultant balance.
8. Motormile agrees to the appointment forthwith of a Skilled Person under section 166 of the Financial Services and Markets Act 2000 to: (1) ensure all write downs under paragraph 7 above have been correctly calculated and applied; (2) assess whether The Offer (as set out in paragraph 7) made by Motormile is appropriate to address any customer detriment caused as a result of breaches of FCA and/or Consumer Credit Act 1974 requirements; (3) oversee adequate communications to customers under paragraph 7 above.
9. Motormile agrees to take all steps which the Skilled Person reasonably identifies in the review described under paragraph 8 as being necessary and appropriate to remedy any customer detriment, which may include the payment of redress. Such steps will be agreed with the FCA.
10. To address the concerns identified in paragraph 4 above the Skilled Person will also conduct an “end-to-end” review of Motormile’s regulated activities. This will cover all aspects of Motormile’s regulated activities including but not restricted to the way in which it acquires regulated loan portfolios to the manner in which debts are collected.
11. Motormile shall restrict its outbound collection activity in respect of any debts due to it under regulated credit agreements (including but not limited to outbound collection calls, postal communications, electronic communications, home visits and SMS messaging) to no more than two written and two outbound verbal contacts per customer per week, regardless of the number of loan accounts each customer holds with Motormile. Motormile will so restrict its outbound collections activity until the FCA’s concerns have been appropriately addressed.
12. Motormile agrees it will not purchase any regulated loan portfolios until a skilled person has signed off that such portfolios have undergone an appropriate and effective due diligence exercise.
Seems the Regulator has finally jumped on this rogue outfit
General
1. This schedule sets out the terms of the requirements to be imposed on Motormile Finance UK Limited (Motormile) with effect from 13 February 2015.
2. Motormile conducts debt purchase and collection.
3. Information obtained by the FCA about Motormile prior to and following a visit to the firm has given rise to serious concerns in relation to Motormile’s debt purchase and collection practices.
4. In particular, the FCA has concerns that Motormile’s debt purchase and debt collections practices are not compliant with the FCA’s requirements and expectations in several respects. For example, Motormile fails to conduct sufficient due diligence upon the purchase of a debt portfolio to be satisfied that the sums due under customer loan agreements are correct. Motormile then engages in debt collections activities with its customers, including outbound collections activity and legal action, for sums which may not be properly due under the loan agreement.
5. These concerns give rise to an ongoing risk to Motormile’s customers and Motormile has agreed to the following requirements to mitigate that risk.
6. Motormile intends that these requirements will remain in place for such length of time as the FCA reasonably deems necessary, taking into account all relevant matters including any evidence that demonstrates it has addressed all of the FCA’s concerns with its business practices and is conducting its business in compliance with the FCA’s rules and guidance and is treating its customers fairly.
Requirements
7. In respect of all its regulated debt collection accounts (“the Accounts”):
• Motormile will write down all currently held regulated customer debts to 175% of the principal sum paid to the customer due under each loan agreement and no further sum will be collected from the customer. (“The Offer”) Where necessary, Motormile will also take all necessary steps to amend the credit files of customers affected by this write down.
• Prior to active collection attempts being made on any Account, Motormile will notify each Customer in writing of the write down on the Account and inform the customer of the resultant balance.
8. Motormile agrees to the appointment forthwith of a Skilled Person under section 166 of the Financial Services and Markets Act 2000 to: (1) ensure all write downs under paragraph 7 above have been correctly calculated and applied; (2) assess whether The Offer (as set out in paragraph 7) made by Motormile is appropriate to address any customer detriment caused as a result of breaches of FCA and/or Consumer Credit Act 1974 requirements; (3) oversee adequate communications to customers under paragraph 7 above.
9. Motormile agrees to take all steps which the Skilled Person reasonably identifies in the review described under paragraph 8 as being necessary and appropriate to remedy any customer detriment, which may include the payment of redress. Such steps will be agreed with the FCA.
10. To address the concerns identified in paragraph 4 above the Skilled Person will also conduct an “end-to-end” review of Motormile’s regulated activities. This will cover all aspects of Motormile’s regulated activities including but not restricted to the way in which it acquires regulated loan portfolios to the manner in which debts are collected.
11. Motormile shall restrict its outbound collection activity in respect of any debts due to it under regulated credit agreements (including but not limited to outbound collection calls, postal communications, electronic communications, home visits and SMS messaging) to no more than two written and two outbound verbal contacts per customer per week, regardless of the number of loan accounts each customer holds with Motormile. Motormile will so restrict its outbound collections activity until the FCA’s concerns have been appropriately addressed.
12. Motormile agrees it will not purchase any regulated loan portfolios until a skilled person has signed off that such portfolios have undergone an appropriate and effective due diligence exercise.
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