Latest news with #ConsumerCreditAct1974
Wales Online
12 hours ago
- Business
- Wales Online
ATOL protection - what to do if your travel company goes bust
ATOL protection - what to do if your travel company goes bust There are various measures in place to protect consumers Things can go wrong (Image: Liam McBurney/PA ) Berkshire-based travel company Great Little Escapes collapsed earlier this week, leaving thousands of holidaymakers in limbo. When a travel company goes bust, suddenly people who were looking forward to their escape abroad are left facing a confusing and stressful situation. When booking a holiday, the last thing on your mind is the possibility that your airline, hotel, or cruise company could collapse. Unfortunately, it happens - and when it does, the result can be both stressful and expensive. This is where end supplier failure comes into play. What happens when a travel company goes bust - end supplier failure Chris Payne, compliance expert at Total Travel Protection, explained: 'End supplier failure refers to the insolvency or financial collapse of a travel service provider - such as an airline, hotel, ferry operator, car hire company, or cruise line - that was supposed to deliver a part of your travel plans. If they cease trading, you may be left without the service you paid for." What to do if your travel firm goes bust The first thing you should do is check if you booked a package holiday - known as ATOL Protected. If you booked a package holiday through a UK travel company and received an ATOL certificate, you're in luck. The ATOL scheme, run by the Civil Aviation Authority, protects you if the travel company or one of its suppliers goes bust. Did it happen before travel? You should get a refund. Already abroad? ATOL will arrange for you to return home. ATOL only applies to air travel packages sold in the UK. Article continues below Did you pay by credit card? Under Section 75 of the Consumer Credit Act 1974, if you paid £100–£30,000 using a UK credit card, the card provider is jointly liable for the failure of the supplier - even if you booked through an intermediary. You can claim a full refund from your card issuer if the service isn't provided due to insolvency. Look for ABTA protection. If you booked land- or sea-based travel (e.g., coach tours, cruises, rail), and the company is an ABTA member, you may be entitled to refunds or alternative arrangements under their protection scheme. ABTA does not cover flight-only bookings. Contact the insolvency practitioner. In cases where ATOL, ABTA, or the Consumer Credit Act doesn't apply, you can contact the administrator or liquidator handling the collapsed supplier's insolvency. They may be organising limited refunds or arrangements. Article continues below What if you're already abroad? Chris said: 'If your end supplier fails while you're away, you should reach out to ATOL or ABTA if applicable. Contact the UK consulate or embassy if you're stranded with no support.' More help and advice can be found at:
Wales Online
22-05-2025
- Business
- Wales Online
Glastonbury Festival glampers lose tickets after luxury brand collapses
Glastonbury Festival glampers lose tickets after luxury brand collapses Some customers had shelled out as much as £10,000 for the packages Glastonbury Festival Glastonbury festivalgoers have been left without tickets just weeks ahead of the event after a luxury glamping firm went bust. Yurtel, known for providing posh camping experiences, has told customers it has "ceased normal trading operations" as of May 8. In the email to customers, Yurtel Limited said: "Yurtel provided luxury glamping accommodation and hospitality facilities to festival goers. It ceased normal trading operations on 8 May 2025 due to insolvency and will commence formal liquidation shortly. It cannot fulfil its future obligations to customers." It's been reported that some customers had shelled out more than £10,000 for Yurtel's glamping packages for Glastonbury. Regarding arrangements for the forthcoming festival, the email noted: "Yurtel is unable to fulfil any ticket and accommodation bookings made for this year's festival. Tickets to enter the festival have not been purchased on your behalf. "Glastonbury Festival has no involvement with the operation of Yurtel but will be able to outline any alternative options which may be available to you. "Please email Yurtel@ to confirm you consent to us sharing your name, contact email and the number of people in your party with the Festival organisers," reports the Liverpool Echo. Article continues below The email concluded: "Accommodation booked with Yurtel will not be available. Should you require accommodation you will need to book with an alternative festival accommodation provider." The company said the money paid to Yurtel was not held in trust, instead it was formed as part of the company's operating capital. Due to the insolvency and "imminent liquidation" it was claimed they cannot refund customers. The statement added: "In the first instance, customers should make enquiries to see if they can claim from their credit card issuer, under section 75 of the Consumer Credit Act 1974, where payment was made to Yurtel by credit card. "A customer who does not qualify to reclaim from their credit card provider will need to make a claim in Yurtel's liquidation. Details of the claim process will be notified to all Yurtel's creditors once the liquidation has commenced." Since then, Yurtel has removed its Instagram account and attempts to reach them via their booking line have been unsuccessful. Despite this, Companies House lists the company as still active. In a statement, Glastonbury Festival rsaid: "We were sorry to learn that Yurtel Limited has appointed liquidators, and appreciate how disappointing this is for anyone who was planning to stay with them. "Glastonbury Festival has no involvement with the operation of Yurtel Limited and as such we have no records of their bookings and are unable to take any responsibility for the services and the facilities they offer. "Whilst Yurtel was one of a small number of campsites local to the Festival site with limited access to purchase hospitality tickets for their guests in certain circumstances, they had not paid Glastonbury Festival for, and had not secured, any tickets for the 2025 Festival prior to entering into liquidation. "Anyone who has paid Yurtel for a package including Glastonbury 2025 tickets will need to pursue any potential recompense available from them via the liquidation process as outlined in their communication to you. We are not able to incur the cost or responsibility of their loss or replacement. "That said, we are asking Yurtel's customers to contact Yurtel@ to confirm their consent for them to share their personal data and details of their party with us. "We will then be able to provide details of alternative potential sources for those customers to purchase tickets and accommodation for this year's Festival." Article continues below
Yahoo
22-05-2025
- Automotive
- Yahoo
Lloyds CEO defends motor finance conduct before MPs
Lloyds Banking Group's chief executive Charlie Nunn has defended the bank's conduct in the car finance market, telling MPs there is 'no evidence of harm' to customers as the sector awaits a critical Supreme Court ruling on the legality of historical commission arrangements. Speaking to the Treasury Select Committee this week, Nunn addressed the lender's exposure to the motor finance market amid a wave of consumer complaints and legal scrutiny. The issue centres on discretionary commission arrangements (DCAs), a practice where car dealers were incentivised by lenders to set higher interest rates in exchange for higher commissions, often without the consumer's knowledge. This embedded content is not available in your region. If the Court upholds an earlier decision by the Court of Appeal that a failure to disclose a commission was in breach of the Consumer Credit Act 1974, the Financial Conduct Authority (FCA) has committed to launching a formal redress scheme within six weeks. In a statement released in January, the FCA said it was monitoring complaint volumes and would intervene 'if firms fail to meet expectations'. Several lenders, including Lloyds, challenged the decision and the case was heard at the Supreme Court in early April. A ruling is expected in July. 'We don't have evidence of harm, or that we've broken regulation,' Nunn was reported in the finance press as saying. 'The Court of Appeal seems to be at odds with 30 years of legislation.' He warned that a lack of clarity from the Supreme Court could 'create dysfunction in the market'. Lloyds has set aside £1.2bn to cover potential liabilities — by far the largest provision in the sector. Barclays, which exited the motor finance market in 2019, has reserved £90m, according to its latest earnings report. The bank's UK chief executive Vim Maru told the Committee that Barclays has seen a surge in historical complaints, some dating back over 20 years, and has deployed 'a few hundred staff' to manage claims. Close Brothers Group is among the most exposed to potential remediation costs, with motor finance accounting for 22% of its gross loans as of end-2021, according to Fitch Ratings. Investec Bank Plc held a more moderate 4% of gross loans in the sector over the same period. Fitch has highlighted that exposure to misconduct-related risks and associated redress liabilities could affect earnings profiles and influence its credit ratings of UK banks. FCA's motor finance probe sparks misconduct risk concerns in UK banking sector: Fitch Ratings Analysts at RBC Capital have projected that total compensation payouts across the industry could reach as high as £32bn in a worst-case scenario. In their base case, total liabilities are forecast at £5.9bn, rising to £10.8bn in a more adverse outcome. If the Supreme Court upholds the Court of Appeal's decision, Lloyds could face an additional £4.6bn in costs under RBC's most severe scenario. Despite the growing provisions, Nunn told MPs there had been 'no material changes in consumer behaviour' and that the final cost exposure would depend heavily on 'the specifics of the decision'. The FCA first banned discretionary commission models in 2021, citing concerns that the practice created conflicts of interest and led to poor outcomes for consumers. The current litigation focuses on past sales practices before the ban was implemented. "Lloyds CEO defends motor finance conduct before MPs" was originally created and published by Motor Finance Online, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
27-03-2025
- Automotive
- Yahoo
Explainer-Is Britain on the cusp of another multibillion-pound consumer finance scandal?
By Sinead Cruise LONDON (Reuters) - The Supreme Court of the United Kingdom will on Tuesday hear arguments to overturn a judgment that could cost Britain's financial industry billions of pounds in fresh legal costs and potential customer compensation. The Court of Appeal ruled in October that it was unlawful for lenders to pay commissions to motor dealers without a customer's informed consent, triggering speculation about the nature and scale of possible remedies for affected borrowers. Lloyds Banking Group, Close Brothers and Santander UK have together already set aside more than 1.5 billion pounds ($1.9 billion) to cover potential compensation claims. Some analysts say the fallout could be the costliest for banks since they paid almost 40 billion pounds in compensation to customers for mis-selling payment protection insurance. WHAT WILL THE SUPREME COURT CONSIDER? Reviewing three earlier claims - two against South African lender FirstRand and one against Britain's Close Brothers - the Supreme Court will decide the extent of car dealers' legal responsibility to provide appropriate information to consumers when also acting as credit brokers. Assuming a duty of care is owed, the court is also expected to rule whether commissions paid by lenders to car dealers were "secret" or insufficiently disclosed, and whether lenders are liable as accessories for procuring the credit brokers' breach of duty. If lenders are considered liable, and the relationship between lender and consumer is considered "unfair" under the Consumer Credit Act 1974, the court will decide what kind of remedy errant lenders have to make. The Supreme Court's judgment is expected in the summer. WHO MIGHT BE IMPACTED? The Financial Conduct Authority banned the payment of discretionary motor finance commissions in 2021, eliminating incentives for brokers to hike the interest rate customers pay on their motor finance loans. But some customers say they were treated unfairly before the ban came into effect, prompting the FCA to launch a probe in January 2024 into historic potential misconduct. If the Supreme Court rules lenders and brokers should have been more transparent about commissions, the regulator has said it will consult on the structure of a compensation scheme within six weeks. More than 2 million people a year rely on the motor finance market to buy a car, FCA data shows. HOW MUCH COULD BANKS HAVE TO PAY? Only a handful of UK lenders have motor finance businesses large enough to be materially concerned about the ruling. These include Lloyds, Close Brothers and Santander UK, which have already made provisions of 1.15 billion pounds, 295 million pounds and 165 million pounds respectively. But analysts say other types of commissions paid by banks to credit brokers could face scrutiny if the court decides customers must consent to such payments. Total 'worst case' industry costs could reach 30 billion pounds, ratings agency Moody's said in November. RBC Capital has estimated a 'base case' impact on banks and non-banks of almost 18 billion pounds. WHAT MIGHT INFLUENCE THE SUPREME COURT DECISION? The outcome of another legal dispute, Expert Tooling vs. Engie Power on March 21, could have a bearing on the motor finance ruling. That case involved Engie supplying electricity to Expert Tooling via an energy broker. The Court of Appeal found that the commission paid to the broker should have been disclosed. However, it did not find Engie an accessory to the broker's breach of duty due to the lack of evidence of dishonesty. Some lawyers say lenders will likely escape significant financial liabilities unless claimants can prove commission payments were concealed or hidden dishonestly. Others are not so sure, citing key differences between the cases, including that the claimant in Expert Tooling vs Engie was a business, not a consumer. WHAT NEXT FOR THE BANKING INDUSTRY? Several major British banks have signalled an interest in recent months in mergers and acquisitions, but worries about a damaging consumer finance scandal have cast a pall over dealmaking. Clarity over the ruling and any compensation scheme could unlock cash set aside to cover legal expenses and revive M&A activity, analysts and bankers say. ($1 = 0.7738 pounds)
Reuters
27-03-2025
- Automotive
- Reuters
Explainer: Is Britain on the cusp of another multibillion-pound consumer finance scandal?
LONDON, March 27 (Reuters) - The Supreme Court of the United Kingdom will on Tuesday hear arguments to overturn a judgment that could cost Britain's financial industry billions of pounds in fresh legal costs and potential customer compensation. The Court of Appeal ruled in October that it was unlawful for lenders to pay commissions to motor dealers without a customer's informed consent, triggering speculation about the nature and scale of possible remedies for affected borrowers. here. Lloyds Banking Group (LLOY.L), opens new tab, Close Brothers (CBRO.L), opens new tab and Santander UK (SANS_pa.L), opens new tab have together already set aside more than 1.5 billion pounds ($1.9 billion) to cover potential compensation claims. Some analysts say the fallout could be the costliest for banks since they paid almost 40 billion pounds in compensation to customers for mis-selling payment protection insurance. WHAT WILL THE SUPREME COURT CONSIDER? Reviewing three earlier claims, opens new tab - two against South African lender FirstRand and one against Britain's Close Brothers - the Supreme Court will decide the extent of car dealers' legal responsibility to provide appropriate information to consumers when also acting as credit brokers. Assuming a duty of care is owed, the court is also expected to rule whether commissions paid by lenders to car dealers were "secret" or insufficiently disclosed, and whether lenders are liable as accessories for procuring the credit brokers' breach of duty. If lenders are considered liable, and the relationship between lender and consumer is considered "unfair" under the Consumer Credit Act 1974, the court will decide what kind of remedy errant lenders have to make. The Supreme Court's judgment is expected in the summer. WHO MIGHT BE IMPACTED? The Financial Conduct Authority banned the payment of discretionary motor finance commissions in 2021, eliminating incentives for brokers to hike the interest rate customers pay on their motor finance loans. But some customers say they were treated unfairly before the ban came into effect, prompting the FCA to launch a probe in January 2024 into historic potential misconduct. If the Supreme Court rules lenders and brokers should have been more transparent about commissions, the regulator has said it will consult on the structure of a compensation scheme within six weeks. More than 2 million people a year rely on the motor finance market to buy a car, FCA data shows. HOW MUCH COULD BANKS HAVE TO PAY? Only a handful of UK lenders have motor finance businesses large enough to be materially concerned about the ruling. These include Lloyds, Close Brothers and Santander UK, which have already made provisions of 1.15 billion pounds, 295 million pounds and 165 million pounds respectively. But analysts say other types of commissions paid by banks to credit brokers could face scrutiny if the court decides customers must consent to such payments. Total 'worst case' industry costs could reach 30 billion pounds, ratings agency Moody's said in November. RBC Capital has estimated a 'base case' impact on banks and non-banks of almost 18 billion pounds. WHAT MIGHT INFLUENCE THE SUPREME COURT DECISION? The outcome of another legal dispute, Expert Tooling vs. Engie Power on March 21, could have a bearing on the motor finance ruling. That case involved Engie supplying electricity to Expert Tooling via an energy broker. The Court of Appeal found that the commission paid to the broker should have been disclosed. However, it did not find Engie an accessory to the broker's breach of duty due to the lack of evidence of dishonesty. Some lawyers say lenders will likely escape significant financial liabilities unless claimants can prove commission payments were concealed or hidden dishonestly. Others are not so sure, citing key differences between the cases, including that the claimant in Expert Tooling vs Engie was a business, not a consumer. WHAT NEXT FOR THE BANKING INDUSTRY? Several major British banks have signalled an interest in recent months in mergers and acquisitions, but worries about a damaging consumer finance scandal have cast a pall over dealmaking. Clarity over the ruling and any compensation scheme could unlock cash set aside to cover legal expenses and revive M&A activity, analysts and bankers say. ($1 = 0.7738 pounds)
