Cornwall youth club in limbo as building put up for sale
Mr Carey said they have another year on their lease but if someone else bought the property they would be given three months' notice before they were "out on our heels"."We've got the opportunity to buy it," he said."We need another £100,000 to complete the deal, if we can do that by the end of April we'll be home and dry - we can secure the building and keep it as a youth club forever. "We've been lucky to secure grants to cover half the money we need and we're hoping that another couple of grants applications that have been made will come through. "What would be really good though is to show some community support because it's important we can show funders we have the community behind us."
The youth group is attended by about 45 to 55 young people, said organisers.Cara, 15, who visits the youth club, said: "I love it here, it's a great place to get away from everything going on at home because life has been hectic over the last year. "I've loved coming here, playing games, practising for my GCSEs, I've loved every second of it."To me it's very important to save it, because it distracts teenagers, gets them off the streets from doing stuff they shouldn't do, so I would love this space to stay open."Ruan, 14, another club member, said: "I think The Vault is a good place to go because it's good to get out of the house sometimes and talk to people."I would say it has made me a better person."Madison, 14, added: "I'd say The Vault is probably the best place to be when you are struggling because you can make new friends and there's lots of things to do when you get bored."
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Telegraph
13 hours ago
- Telegraph
An establishment stitch-up at the expense of consumers
The market reaction to the Supreme Court's intervention in the car finance mis-selling scandal tells you everything you need to know about this grubby saga. Shares in Lloyds Bank, the UK's biggest car finance provider through its Black Horse brand, jumped as much as 7.5pc when trading commenced on Monday morning, leaving it at the top of the FTSE 100 leaderboard. The share price of Close Brothers, a specialist lender that is disproportionately exposed to the car finance market, surged as much as 25pc having sunk to 30-year lows as the industry braced for PPI-sized payouts. Shares in Bank of Ireland and Barclays, both of which have car finance arms, rose 4.2pc and nearly 2pc respectively. Make no mistake about it, the Supreme Court's ruling is a serious let-off for the banks and other lenders that have a big presence in the car loans space. True, revised payout estimations of between £9bn and £18bn to customers who were mis-selling victims is not to be sniffed at. However, even the top end of the range is less than half the £44bn bill the sector was collectively thought to be facing before the Supreme Court decision. The lower end would be just a quarter. It is a massive result for an industry that fought this case tooth and nail. Anthony Coombs, a former Tory MP and now chairman of lender S&U, whose shares had tanked 33pc at one stage, described it as 'a victory for common sense'. I'm not so sure about that. I certainly share the concerns of many about the shameless ambulance-chasing law firms and claims management firms that have helped fuel Britain's compensation culture. Clearly, it means there is a high risk of people jumping on the bandwagon and lodging bogus claims that the banks then feel the need to recover through higher borrowing costs for all of us. But that's hardly a new phenomenon – there will always be a relatively small number of chancers looking to game the system wherever they can. I'm less inclined to celebrate what has the unmistakable feel of an establishment stitch-up at the expense of consumers. I have a natural aversion to the armies of highly-paid lobbyists who go into bat for big business, skewing what is already a massive power imbalance even further. Consumers already face a David-versus-Goliath battle to be treated fairly. In this case, the scare tactics employed were particularly shameless as industry campaigners sought to ensure the Supreme Court's ruling was as favourable as possible to the banking community. Even now, despite a significant legal climbdown, these same activists felt the need to take to the airwaves to issue fresh apocalyptic warnings. Stephen Haddrill, the director general of the Finance & Leasing Association, claimed the scheme could push up borrowing rates for car-buyers as if somehow large corporations have no choice but to always pass on any additional costs to their customers. The same arguments were rolled out after Covid when companies claimed they were lifting prices to offset their own cost increases and they were no more convincing back then – with research suggesting pandemic profiteering was rife among the biggest companies. As if that wasn't sufficiently disingenuous, John Phillipou, chairman of the Finance & Leasing Association, weighed in too, complaining that there was a risk of harm to Britain's 'investability'. Still, lobbying is what lobbyists do and at least they make no attempt to hide their true intentions. Moreover, Phillipou is only echoing our alarmist Chancellor, and it is surely far more outrageous that she sought to meddle in the outcome. Rachel Reeves has absolutely no business at all involving herself in such matters, while there is zero evidence to back up her suggestion that large-scale payouts represented a threat to growth. Yet, as with the wrong-headed ousting of the chairman of the competition watchdog, the Treasury will stop at nothing in its attempts to deflect blame for Britain's floundering economy from the Chancellor's job-wrecking tax raid. The reasons for the UK's lack of competitiveness are innumerable and too often they can be laid at the door of 11 Downing Street. Reeves's willingness to side with bank bosses instead of standing up for the little man is also disquieting. The job of the Supreme Court judges is to ignore the noise and correctly apply the law but ministers seem to have allowed themselves to be captured by the lobbying fraternity. Voters may see it as another betrayal from a party that has waged war on hard-working families with its tax blitz. As Liberal Democrat MP Bobby Dean rightly said, Government interventions like this set a bad precedent if the reason for intervening is that it might damage industry, 'because then almost every consumer redress case would fall'. Dean, who is a member of the powerful Treasury select committee that polices the City, regulators and the Treasury, points out that compensation schemes give consumers confidence to borrow and invest, 'if they know they will be protected when companies take advantage of them'. It is now down to the Financial Conduct Authority (FCA) to restore the balance after it confirmed it will consult on a redress scheme for those still entitled to compensation. But that hardly inspires confidence. After all, this is the same FCA that was described in a damning report by MPs and Lords just last year, as 'incompetent at best, dishonest at worst'; its actions as 'slow and inadequate.' The chances of the watchdog suddenly showing some teeth seem slim.
The Independent
21 hours ago
- The Independent
Major lenders see share prices surge after car finance mis-selling ruling
Shares in major lenders soared on Monday morning as businesses and markets reacted to the Supreme Court ruling on car finance mis-selling. The ruling on Friday came after stock markets closed, meaning market reaction hit at the start of the new week – with Lloyds Bank rising more than 7 per cent and Chase Brothers shares shooting up more than 30 per cent initially, before settling back to just over 20 per cent up. Others in the British banking sector also rose, with Barclays and NatWest up close to 2 per cent. Lenders are on the line to pay out up to £18bn in compensation to those affected, but the ruling found them not liable for hidden commission payments which could have sent reimbursement costs soaring. The banks had largely already set aside a provision for paying out compensation, though each had previously noted the wide range of possible outcomes from the court case, meaning they could not necessarily plan for it entirely. However, having allocated around £1.2bn towards payouts already, Lloyds have now said any additional funds they have to set aside for the same reason are 'unlikely to be material in the context of the group', adding that 'the provision will continue to be reviewed for any further information that becomes available, with an update provided as and when necessary.' Chase Brothers were seen as more exposed to payouts relative to its position and size in the market, hence the more outsized change in its share price. The court decision has been seen as a 'win' for lenders by significantly limiting the potential payouts in compensation, according to experts. But the judgment left open the door for potential redress claims for very large commissions, which the Supreme Court said were unfair and therefore potentially unlawful. Close Brothers – which together with South Africa's FirstRand Bank had mounted the legal challenge against a Court of Appeal ruling that 'secret' commission payments on motor finance were unlawful – said over the weekend that it welcomed the Supreme Court judgment. It had put by £165m to cover potential redress, which sent it slumping to a £103.8m half-year loss, and warned in March over a further £22m hit to annual figures from legal and other costs linked to the motor finance case. Close Brothers said there 'remains uncertainty as to the range of outcomes, and the financial impact to the group, including any impact on its provisioning assessment' until the outcome of the FCA 's consultation is clear.
Times
a day ago
- Times
Lenders in car finance scandal brace for judgment from investors
Shares in lenders most likely to be forced into compensation payments to consumers who purchased vehicles on credit will be closely watched in the City on Monday, after the financial watchdog set out plans for a redress scheme of up to £18 billion. Close Brothers, Lloyds Bank, Barclays and the controlling group of Santander UK, among Britain's largest providers of motor finance, could see an impact on their share prices as investors consider the consequences of the Financial Conduct Authority announcing plans for a potential compensation scheme that could distribute payments as soon as next year. The FCA said on Sunday that a redress scheme could cost between £9 billion and £18 billion and should cover car loans dating back to 2007. Individuals could receive payments of almost £950 each. The announcement from the City watchdog came after the Supreme Court overruled key elements of an earlier judgment from the Court of Appeal in October that could have put the motor finance industry on the line for compensation payments of more than £30 billion, similar in scale to the £50 billion of payouts under the payment protection insurance scandal of the 2010s. Following that October ruling, shares in Close Brothers, one of the largest players in Britain's motor finance market, slumped by about a quarter in just one day. Shares in Lloyds Bank, which is exposed via its Black Horse lending arm, tumbled by more than 7 per cent. RBC Capital Markets predicted a 'sector impact' of £11.5 billion, with banks paying £3.8 billion and non-banks paying £7.7 billion. Banks had already set aside billions of pounds for possible compensation payments for people who bought a vehicle from a dealership that failed to properly disclose commissions they received from lenders. Lloyds Banking Group alone reserved £1.2 billion. However, analysts at the investment bank Jefferies predicted that the regulator's plans 'largely de-risk Lloyds' shares' from the scandal and that the redress scheme 'is consistent with our long-held assumptions'. Carmakers will also be in focus as many have their own in-house credit divisions. In the wake of the October Court of Appeal ruling, Honda and BMW stopped offering new loans to customers. Alex Neill, co-founder of the rights group Consumer Voice, said: 'Millions of drivers placed their trust in car dealers to secure a fair deal, yet were kept in the dark about unfair commissions that inflated the cost of borrowing. Now, for the first time there is a clear path to justice.' Slater and Gordon, a law firm, said: 'While the [Supreme] Court effectively sided with lenders in two of the three cases, the judgment does not close the door on compensation.' However, it said it was 'concerned that aspects of any proposed redress scheme may inadvertently exclude a significant number of those affected'. Adrian Dally, director of motor finance at the Finance & Leasing Association, an industry body, said: 'We have concerns about whether it is possible to have a fair redress scheme that goes back to 2007 when firms have not been required to hold such dated information, and the evidence base will be patchy at best.' The FCA shocked the motor finance industry in January last year when it announced it would examine so-called discretionary commissions paid to dealers between April 2007 and January 2021, when these types of payments were banned. Under such discretionary commission arrangements, brokers were allowed to set the interest rate on loans extended to borrowers. If they charged a higher rate, they would receive larger commissions, so they were motivated to do so at the expense of consumers' finances. Concerns within the motor finance market then amplified in October when the Court of Appeal decided that car dealers, in their capacity as credit brokers, had a fiduciary duty to their customers, meaning that they should act in consumers' best interests. It also said that undisclosed commissions amounted to bribes. Key elements of this judgment were overturned by the Supreme Court last Friday. There were about 25.9 million motor finance deals arranged between 2007 and the end of 2020, although the Supreme Court ruling means many will be ineligible for redress. There had been fears in the government that lenders would face a deluge of compensation claims, leading to the car finance market seizing up. The Treasury had been considering whether to step in to protect lenders.
