FCA Regulator link to reporting "unfair terms"

[amelia33]

Re: FCA Regulator link to reporting "unfair terms"

307 views.............................has anyone actually gone through this procedure of reporting & will you please let the side know what you get if only standard acknowledgement please :tinysmile_twink_t2:

it is good to see others are fighting for rights in the unregulated arena - it is so unfair - I have tried to get my unregulated contract (1998) looked at by FOS and FCA under Unfair Terms, however, the reply I received from a senior manager was not covered. it seems the most vulnerable consumers who were sold totally unsutiable subprime products have no where to turn and are slaves to the unregulated industry for the rest of their lives:tinysmile_cry_t:

i was hanging my hopes on this
Although the FOS is operationally independent of the FCA there is a memorandum of understanding ("MOU") between the two organisations. The MOU provides a framework to enable us to co-operate and communicate constructively in carrying out our independent roles and separate functions. Under the MOU, the FCA and the FOS agree to consult each other and seek a complementary and consistent approach.

Q6: Do the Regulations apply to historical contracts?

Answer:

The Regulations apply to consumer contracts entered into on or after 1 July 1995. This is because the EU Directive that is implemented by the Regulations came into force on that date. The Regulations do not apply retrospectively to contracts entered into prior to 1 July 1995.

[amelia33]

Re: FCA Regulator link to reporting "unfair terms"

There are also limits to the scope of the Unfair Terms Regulations. While they do cover any contract entered into after 30 June 1995, they do provide that “the assessment of fairness of a term shall not relate … to the adequacy of the price or remuneration, as against the goods or services supplied in exchange” (regulation 6), so the level of fees added to your loan is not something we can consider.

actually complaint was about the unfair terms but this was totally ignored???

[Fred]

Re: FCA Regulator link to reporting "unfair terms"

There are also limits to the scope of the Unfair Terms Regulations. While they do cover any contract entered into after 30 June 1995, they do provide that “the assessment of fairness of a term shall not relate … to the adequacy of the price or remuneration, as against the goods or services supplied in exchange” (regulation 6), so the level of fees added to your loan is not something we can consider.

actually complaint was about the unfair terms but this was totally ignored???

I would pursue your questions with the consumer.queries@fca.org.uk. they do have duty to reasonably answer/reply to consumer inquiries albeit initially on an information basis.

Tell them about the FOS & ask who is there to help they do work for us all said & done be direct & ask them what you options are.

[Fred]

Re: FCA Regulator link to reporting "unfair terms"

Again I wish to draw attention to what could possibly be an early initiative by the FCA on some of the downtrodden consumers involved in "unregulated" secured loans.

I do most certainly believe that there has never been a better time to let them know about your concerns as per the links above.

:bump::bump:

Please.

[amelia33]

Re: FCA Regulator link to reporting "unfair terms"

Fred, many thanks

I will try again, have been seriously ill, so maybe after early next year before I can do so, but I will try as I feel so offended by this injustice not just to me but to all who clearly exist solely, it seems, on forums such as this as they go unheard by the industry and its regulators

I have noticed this - however, I dont know if this opens any avenue toward regulator coverage? -

source :FEEDBACK ON OUR CONSULTATION ABOUT
EXTENDING OUR JURISDICTION
1 Summary
1.1 In May 2002 we published a consultation paper1.

Past events before 1 December 2001
2.1 The consultation paper explained that neither our compulsory jurisdiction nor our voluntary jurisdiction currently covers events before 1 December 2001 for:
activities (apart from accepting deposits and providing general insurance policies) that were FSA-regulated from 1 December 2001 or later; where
the firm was not covered by any of the eight former complaint-handling schemes4 immediately before 1 December 2001.
2.2 To deal with this obvious gap, and the consequent scope for confusion, we proposed to:
extend our voluntary jurisdiction to cover events before 1 December 2001 for activities that were FSA-regulated from 1 December 2001 or later; but
restrict the activities to ones that were FSA-regulated at the date the particular firm joined the voluntary jurisdiction, so the firm knew what it was signing up to.
2.3 In the responses:
Most respondents supported such an extension, in order to provide consistent coverage.
Most of the respondents who would be eligible to sign up for the extension said they would be willing to do so.
A few respondents thought firms might be deterred from joining by a fear that standards would be applied retrospectively.
2.4 On the last point, we remind firms that, under our rules, we take into account what was required by any relevant law, regulation, code or good industry practice at the time o the event complained abou. f t
2.5 We have concluded:
We should extend our voluntary jurisdiction to cover events before 1 December 20015 for all activities that are FSA-regulated at the date the particular firm joins.
We will approach relevant firms from 1 January 2003 with a view to their applying to join, and we will implement the extension to the voluntary jurisdiction with effect from 1 April 2003.

(edit) - also, I imagine I would need to know if the intermediary or lender were actually signed up to this VJ?

I am aware the broker(intermediary) Loans.Co who were known as Home Counties Credit at the time are dissolved, no longer in business last time I checked, and Loans.Co appear on the FSCS website, however, they also refuse to consider any complaint due to timescales - this is so frustrating and I cannot fathom the reasoning apart from protection of the worst offenders of the finance industry - didnt such practices create the crash?!

[amelia33]

Re: FCA Regulator link to reporting "unfair terms"

Fred, can you be more specific about the 'early initiative by the FCA' re downtrodden consumers?

much appreciated!

[Fred]

Re: FCA Regulator link to reporting "unfair terms"

Fred, can you be more specific about the 'early initiative by the FCA' re downtrodden consumers?

much appreciated!

A few of us including myself have written to the FCA & previously the OFT with our concerns, the OFT complaints are still/now being handled by the CMA who have been given the responsibility of continuing affairs (& that is who now employs most of the old OFT staff) the FCA replies to date have been poor, lacking in consistencies & void of any structured debatable material.

The FCA concerns have been put to the Complaints Commissioner who in turn has thrown it back to the FCA complaints team as it was so poor in that they did not even address some of the vital points..................they have now assured me that matters are being dealt with high importance & changes are/have been made. I have not yet had a full response to this but very much look forwards to the contents as indeed some of the guys on here will also.

They are tight lipped on the issues relating to the or any organisations we complained about but have asked for more detail from us............the content of the complaints is based on "fairness" as the use of CCA 140 unfair relationships & UTCCR 5.1 both apply to "unregulated" loans & therefore some licensing issues remain open as in partly regulated ?

There is some more stuff on my other thread;

http://www.legalbeagles.info/forums/...967#post492967

I can not put everything on there for obvious reasons but the informations due in should give us a base for constructive argument. mashappy:

[Fred]

Re: FCA Regulator link to reporting "unfair terms"

The link below is a short but interesting read from one of the banks favourite legals;

http://www.eversheds.com/global/en/w...he_future_hold

[amelia33]

Re: FCA Regulator link to reporting "unfair terms"

thank you. I have crossed swords wth eversheds who were appointed by GE (I Group).

they agreed to settle but then GE continued with the same practice, racking up huge charges with interest since then

[amelia33]

Re: FCA Regulator link to reporting "unfair terms"

thank you for the link, I cannot open this, perhaps I need to be a vip member?

regarding S140 of CCA 1974, I thought this was not retrospective? (1998) as I have tried to argue the unfair relationship in court and judge agreed with the barrister hired by GE, who stated no regulations apply to this product and that MCOB is only a guideline!

[MIKE770]

Re: FCA Regulator link to reporting "unfair terms"

The link below is a short but interesting read from one of the banks favourite legals;

http://www.eversheds.com/global/en/w...he_future_hold

Amelia opened for you:-

“unfair relationship” concept in respect of credit agreements was introduced into the Consumer Credit Act 1974 (“CCA”) on 6 April 2007[1]. Seven years later, this article reflects on how the provisions of the test have been interpreted and applied by the courts and how the law is likely to develop.
Concept

The unfair relationship provisions replaced the former extortionate credit bargain regime[2]. Previously, the court had the power to reopen the credit agreement if it found a credit bargain was such that it required the debtor to make payments which were “grossly exorbitant” or otherwise “grossly contravene ordinary principles of fair dealing”. In practice, the courts were generally slow to intervene and these provisions were therefore rarely invoked and even more rarely produced a successful outcome for the debtor[3].
The Department for Trade and Industry proposed in its 2003 White Paper that it should be easier for consumers to challenge unfair agreements and that the definition of ‘extortionate’ should be widened to cover unfair practices both at the time of entering the credit agreement as well as any subsequent events that may have led to unfairness. These proposals formed the basis of the unfair relationship provisions in the CCA.
Test

The unfair relationship test is set out in section 140A of the CCA. It permits the court to make an order under section 140B if it determines that the relationship between a creditor and debtor arising out of the agreement (or related agreement) is unfair to the debtor based on one or more of the following:

• Any of the terms of the agreement or of any related agreement;
• the way in which the creditor has exercised or enforced any of his rights under the agreement or any related agreement;
• any other thing done (or not done) by, or on behalf of, the creditor (either before or after making of the agreement or any related agreement).

Contrary to the normal position that ‘he who asserts must prove’, where the debtor alleges that the relationship is unfair, it is for the creditor to prove that it is not (section 140B(9) of the CCA). That said, HHJ Waksman in Carey v HSBC Bank plc[4]held that a mere assertion of a breach on the part of the creditor under the CCA (section 78 in this case) did not in itself give rise to an unfair relationship under section 140A.
Scope

The provisions apply to both regulated and unregulated credit agreements and section 140A gives the court a broad discretion to “have regard to all matters it thinks relevant”.
The discretion applied by the court has proved the unfair relationship regime to have wide reaching effect.
In Patel v Patel[5] the High Court held that the relevant question is whether it is the relationship arising out of the credit agreement which is unfair, not whether the agreement itself was unfair. This case also set the precedent in respect of limitation, when the court looked at what the relevant date is at which the fairness or unfairness has to be determined. It was held that the relevant date is the date on which the debtor-creditor relationship ended. If the relationship is continuing, then the determination should be made at the time of the trial. This gave the court scope to look at the entirety of the debtor-creditor relationship when making a determination of its fairness.
Application

Whereas the extortionate credit bargain regime was seldom used, there has been a raft of case law stemming from the unfair relationship provisions, largely involving mis-selling claims in respect of payment protection insurance (“PPI”). Debtors are quick to make a claim under section 140A alongside allegations of statutory breaches and negligence.
There have been few debtor friendly results[6], with the majority of decisions favouring the lender. In 2011, the Court of Appeal (“CA”) took a detailed look at the unfair relationship provisions and delivered its lender-friendly judgment in Harrison and Anor v Black Horse Limited[7]. This key case provided much needed clarification on a number of PPI specific points as to what will (or will not) amount to a relationship being deemed unfair under section 140A. Crucially, the CA held that a failure to disclose details of commission did not in itself render a relationship unfair.
More recently, the CA has delivered judgment in the conjoined cases of Conlon v Black Horse Limited and Plevin v Paragon Personal Finance Limited[8]. In Conlon the CA, whilst following the precedent set by Harrison, took the opportunity to express their discomfort with the earlier judgment, stating that to follow it led to a “dispiriting conclusion”. In Plevin, the CA considered the meaning of “on behalf of” in section 140A and opted for a wide interpretation, so that a creditor could be held liable for anyone on the creditor’s side of the transaction (albeit that this power is discretionary and does not necessarily mean that the creditor will “carry the can” for a broker’s conduct). In reaching their decision, the CA relied on the voluntary FISA and FLA codes, leaving trade associations in a difficult position when it comes to developing codes of practice as this outcome has shown that such codes can be taken into account by the courts when determining the fairness, or unfairness, of a relationship.
Permission to appeal to the Supreme Court has been granted for both cases.
Current position

The decision in Harrison provided a large degree of comfort to lenders. However, with the burden of proof reversed, claims are still hard to strike out, particularly PPI mis-selling claims which are very fact specific and reliant on witness evidence to prove that the relationship is fair[9]. The CA’s decision in Plevin has caused concern amongst lenders and it appears likely that the Supreme Court will shortly have its opportunity to consider the unfair relationship provisions in detail in these conjoined cases. In the meantime, Harrison remains the leading case and lenders and debtors alike will eagerly await the judgment of the Supreme Court.
Future

Compliance with the regulatory framework, has, to date, assisted creditors in defending unfair relationship claims. The Court in Harrison said that the ‘touchstone’as to whether a relationship was unfair was “the standard imposed by the regulatory authorities pursuant to their statutory duties”and that they should “not resort to a visceral instinct that the relevant conduct is beyond the Pale.” The Court went on to refer to the Insurance: Conduct of Business Rules (“ICOB”) and whether those rules required disclosure of receipt of commission stating that it would be an “anomalous result if a lender was obliged to disclose receipt of a commission in order to escape a finding of unfairness under section 140A of the Act but not yet obliged to disclose it pursuant to the statutorily imposed regulatory framework under which it operates”.
However, the CA’s analysis did not consider the higher level principles (PRIN) contained in the FCA Handbook, many of which may be considered relevant to whether a relationship was unfair. Future courts may look to PRIN to assess compliance with the ‘spirit’ of the regulatory regime rather than compliance with detailed rules.
The regulatory landscape changed significantly on 1 April this year as regulation of consumer credit was transferred from the OFT to the FCA. Consumer credit businesses are now subject to the provisions of the Handbook and to the new Consumer Credit Sourcebook, known as ‘CONC’. While there is a ‘grace period’ in relation to certain aspects of CONC that does not apply to the many other aspects of the Handbook. In particular, the FCA will expect compliance with PRIN immediately.
The law of unfair relationship is unlikely to emerge unchanged from this regulatory shift. The change may come from the regulator, with an already established reputation for being pro-active, or it may come from the courts dealing with a new set of claimants bringing fresh proceedings for unfair relationships. Then there is the much anticipated decision of Supreme Court in Plevin and Conlon. What is undoubtedly called for is more certainty in this area of law.

---

[1] Inserted by section 19 of the Consumer Credit Act 2006
[2] Formerly contained in sections 137 to 140 of the CCA and repealed by the Consumer Credit Act 2006
[3] The Department for Trade and Industry (DTI) stated in its 2003 White Paper (Fair, Clear and Competitive: The Consumer Credit Market in the 21^st Century) that since the CCA was introduced only “about 30 extortionate credit cases are known to have reached the courts and, of those, only ten were proven”.
[4] [2009] EWHC 3417 (QB)
[5] [2009] EWHC 3264 (QB)
[6] Such as in Yates & Lorenzelli v Nemo Personal Finance and another, Manchester County Court, 14 May 2010
[7] [2011] EWCA Civ 1128
[8] [2013] EWCA Civ 1658
[9] Although the absence of witness evidence from the sales representative involved at the time of the sale does not necessarily mean that the creditor’s

[amelia33]

Re: FCA Regulator link to reporting "unfair terms"

I am happy to provide any information the FCA feel they need about such matters!mashappy:

[amelia33]

Re: FCA Regulator link to reporting "unfair terms"

On 6 April 2007 new provisions were inserted into the Consumer Credit Act 1974 giving the court far reaching powers in relation to any credit agreement (unless the borrower is corporate or the agreement is an FSA regulated mortgage contract) if it determines that the relationship between the creditor and the debtor arising out of the agreement is unfair to the debtor (the “unfair relationships” provisions in ss. 140A – 140D). The provisions were effectively retrospective: that is, they apply to agreements made before as well as after the new provisions came into force, provided the agreement was not completed prior to 6 April 2008.

in the above quote I underline the problem I experienced, a mortgage product that is not FSA regulated i.e. unregulated, what then...
(apologies for inconsitencies as I am tyring to understand what can be argued as covered or should have been at that time) my feeling is given the firm GE barrister hailded from, they would have known only too well

[Fred]

Re: FCA Regulator link to reporting "unfair terms"

The bit "underlined" applies mostly to business loans or loans/agreements specific to individual circumstances.........the consumer is covered by the limited but very important parts of the CCA 1974 140 unfair relationships on "unregulated" secured second charge loans/mortgages...............its very much the case that the regulators are giving out miss-information which they seem reluctant to deny or confirm.

[amelia33]

Re: FCA Regulator link to reporting "unfair terms"

I see - so a first charge mortgage product but unregulated (over 25K) secured on land seems to be the wording the regs tend to use - is not covered as not second charge and not a buy to let mortgage either