Windfall from BMW Financial Services
Discussion
Opened a rather innocuous envelope this morning thinking it was another bit of compliance or marketing material from BMW to find a letter advising that they had failed to comply strictly with Consumer Credit Regulations.
This didn't affect the amount I paid them at all but nevertheless, I had a rather nice cheque refunding all the interest that I paid for year's two and three of my E90 M3 saloon credit agreement.
Anybody else be similarly successful or understand the ins and outs? My wife had her Mini Cooper S on a finance agreement around the same time so I wondered if there may be similar issues there.
This didn't affect the amount I paid them at all but nevertheless, I had a rather nice cheque refunding all the interest that I paid for year's two and three of my E90 M3 saloon credit agreement.
Anybody else be similarly successful or understand the ins and outs? My wife had her Mini Cooper S on a finance agreement around the same time so I wondered if there may be similar issues there.
MerseaBoy said:
Do you mind saying when you took it out and what the infringement was??
Thanks.
I took my finance agreement out in March or April 2009 and then p-ex'd in Mar 2012.Thanks.
I had now discarded the letter but I think it was because the statements they sent out were not compliant with one of the credit consumer acts.
Timbola said:
Finance houses sending out small sums to pre-empt/mitigate large fines from the FCA for falling foul of minor regulatory infringements - in this case the CCA.
This was not a small amount - my original post does say they have refunded all of my interest from the point of the infringement - so I have received a very substantial four figure sum - shall we say enough to take my family of four adults on a very decent weeks skiing.Edited by Timbola on Friday 19th December 08:44
I didn't try to work out whether the actual sum is correctly calculated based on the explanation in the letter, but given the amount was unexpected, and it seems very generous for what appears a modest technical infringement, I wouldn't pursue them for any more money anyway.
Timbola said:
The comparison was made between the amount they volunteered to settle with you, and the fines imposed by the FCA.
Punitive fines imposed by the regulator can and do run to billions of pounds. Court settlements pursuant to claims can and do run to millions. So your four-figure sum is a drop in the ocean to a finance house. Which is the point being made - if they can mitigate or avoid the fines and court settlements by paying out a few hundreds of thousands of pounds in voluntary settlements such as yours, they will. It's all profit, innit.
To put it in perspective, the £2bn the incumbent Conservatives have allotted toward an increased spend on the NHS has come purely from FCA-levied fines. That's just one application of that particular pot of funds.
Regardless, from the standpoint of your individual point of view, an unexpected windfall is just that. Enjoy.
Thanks I will Punitive fines imposed by the regulator can and do run to billions of pounds. Court settlements pursuant to claims can and do run to millions. So your four-figure sum is a drop in the ocean to a finance house. Which is the point being made - if they can mitigate or avoid the fines and court settlements by paying out a few hundreds of thousands of pounds in voluntary settlements such as yours, they will. It's all profit, innit.
To put it in perspective, the £2bn the incumbent Conservatives have allotted toward an increased spend on the NHS has come purely from FCA-levied fines. That's just one application of that particular pot of funds.
Regardless, from the standpoint of your individual point of view, an unexpected windfall is just that. Enjoy.
Edited by Timbola on Friday 19th December 16:24
Really flagged up the issue so others were aware and may be able to benefit - do you know what the process should be to make an enquiry because from some of the posts it seems not only BMW who fell foul of this. I'm a bit surprised I hadn't seen anything about it before.
OK so I still have the letter from BMW Financial Services and it states:
"Following a recent review, it has come to our attention that your annual statement(s) covered a period in excess of a year. This meant the annual statement(s) you received did not strictly conform to the requirements of the Consumer Credit Act (the Act).
Importantly, this has not affected the payments that you needed to make, the accuracy of the calculation of the outstanding balance on your account or the interest charge we applied, if any.
Although this has not affected what you were required to pay under your agreement, due to the statutory provisions of the Act, we are reimbursing you any interest and/or default sums charged to your account which relate to the period starting from when we were required to send you the statement until the end of your agreement (which is the relevant period under the Act). This amounts to the sum of £X,XXX.
We enclose a cheque for this amount"
"Following a recent review, it has come to our attention that your annual statement(s) covered a period in excess of a year. This meant the annual statement(s) you received did not strictly conform to the requirements of the Consumer Credit Act (the Act).
Importantly, this has not affected the payments that you needed to make, the accuracy of the calculation of the outstanding balance on your account or the interest charge we applied, if any.
Although this has not affected what you were required to pay under your agreement, due to the statutory provisions of the Act, we are reimbursing you any interest and/or default sums charged to your account which relate to the period starting from when we were required to send you the statement until the end of your agreement (which is the relevant period under the Act). This amounts to the sum of £X,XXX.
We enclose a cheque for this amount"
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