Shawbrook Bank Limited · DRN-6220327

The complaint With the assistance of a third-party professional representative “S”, Mrs L and Mr L say Shawbrook Bank Limited unfairly declined a claim under section 75 of the Consumer Credit Act 1974 (‘CCA’). They also say their credit relationship with Shawbrook Bank was unfair to them under section 140A of the CCA. Background to this decision I recently issued my provisional decision setting out the events leading up to this complaint and my intended conclusions. I’ve reproduced my provisional decision here and it is incorporated as part of my overall findings. I invited both parties to let me have any further comments they wished to make in response, which I will address later in this decision. My provisional decision On 3 May 2015 (the ‘Time of Sale’), Mrs L and Mr L purchased a timeshare membership (the ‘Purchase Agreement’) – which I’ll call ‘Fractional Club’ membership – from a timeshare provider “C”. Membership was asset backed, which means it gave Mrs L and Mr L more than just holiday rights. It included a share of the net sale proceeds of a property named on the Purchase Agreement (the ‘Allocated Property’) after the membership term ended. Under the Purchase Agreement Mrs L and Mr L exchanged fractional holiday rights for points, which allowed them to reserve holidays at C’s resorts worldwide. Mrs L and Mr L had an existing membership with C, which they ‘traded in’ to increase their total fractional points. Mrs L and Mr L borrowed £29,577 from Shawbrook Bank (the ‘Credit Agreement’) to pay for membership, and to consolidate borrowing associated with their existing membership. In a letter dated 20 March 2024, S wrote to Shawbrook Bank on behalf of Mrs L and Mr L (the ‘Letter of Claim’) to make a claim under sections 75 and 140A of the CCA. S said, in summary: • The claim related solely to the purchase in the sum of £3,368, which was funded by the Shawbrook Bank loan. • C told Mrs L and Mr L that membership would ensure their holiday accommodation would be secured for the term of the contract, as they could book from the many options available. And it told them that the purchase was an “investment” and could be sold at a later date for a profit. Neither of these were true, and amounted to misrepresentation giving rise to a claim against Shawbrook Bank under the connected lender liability provisions of section 75 of the CCA. • C’s sales and marketing practices, the terms of the Purchase Agreement and C’s other representations and omissions breached consumer protections. The ‘deemed agency’ provisions of section 56 of the CCA meant Shawbrook Bank was responsible for negotiations C carried out prior to Mrs and Mr L entering into the contract. C’s

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actions thus rendered the credit relationship with Shawbrook Bank unfair to Mrs L and Mr L under section 140A of the CCA. • C pressured Mrs L and Mr L into purchasing membership, due to a long sales process and giving them the impression they couldn’t leave without agreeing to purchase membership. • C breached Regulation 14(3) of The Timeshare, Holiday Products, Resale and Exchange Contracts Regulations 2010 (the “Timeshare Regulations”) by actively relying on the membership’s potential to provide an investment return. • Specific terms were unfair by reference to the Unfair Terms in Consumer Contracts Regulations 1999. Shawbrook Bank dealt with the Letter of Claim as a complaint and issued its final response letter on 11 September 20241. The final response letter noted that the loan in question had started in May 2015 and was settled in May 2018. Shawbrook Bank considered the claim to be time barred under the Limitation Act 1980. S referred the complaint about the £3,368 purchase in 2015 to our service. Our investigator wasn’t minded to uphold the complaint. He accepted Shawbrook Bank’s position that it had a complete defence to Mrs and Mrs L and Mr L’s section 75 claim due to provisions in the Limitation Act 1980. He wasn’t minded to agree that this extended to the claim Mrs L and Mr L had made under section 140A. However, he didn’t find the case circumstances were sufficiently persuasive of an unfair credit relationship between Mrs L and Mr L and Shawbrook Bank. On behalf of Mrs L and Mr L, S asked for the complaint to be reviewed by an ombudsman. The legal and regulatory context In considering what is fair and reasonable in all the circumstances of the complaint, I am required under DISP 3.6.4R to take into account: relevant (i) law and regulations; (ii) regulators’ rules, guidance and standards; and (iii) codes of practice; and (where appropriate), what I consider to have been good industry practice at the relevant time. I will refer to and set out several regulatory requirements, legal concepts and guidance in this decision, but I am satisfied that of particular relevance to this complaint is: • The CCA (including section 75 and sections 140A-140C). • The law on misrepresentation. • The Consumer Protection from Unfair Trading Regulations 2008 (‘CPUT’). • The Timeshare, Holiday Products, Resale and Exchange Contracts Regulations 2010 (the ‘Timeshare Regulations’). • The Consumer Rights Act 2015 (the ‘CRA’). • Case law on Section 140A of the CCA – including, in particular: • The Supreme Court’s judgment in Plevin v Paragon Personal Finance Ltd [2014] UKSC 61 (‘Plevin’), which remains the leading case in this area. 1 The final response letter also set out Shawbrook Bank’s response to a similar claim from S’s client made in relation to a 2019 purchase, which I understand has been the subject of a separate complaint S brought to us. In light of that, I don’t propose to comment further here on Shawbrook Bank’s response to the 2019 purchase.

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• Scotland v British Credit Trust [2014] EWCA Civ 790 (‘Scotland and Reast’) • Patel v Patel [2009] EWHC 3264 (QB) (‘Patel’). • The Supreme Court’s judgment in Smith v Royal Bank of Scotland Plc [2023] UKSC 34 (‘Smith’). • Carney v NM Rothschild & Sons Ltd [2018] EWHC 958 (‘Carney’). • Kerrigan v Elevate Credit International Ltd [2020] EWHC 2169 (Comm) (‘Kerrigan’). • R (on the application of Shawbrook Bank Ltd) v Financial Ombudsman Service Ltd and R (on the application of Clydesdale Financial Services Ltd (t/a Barclays Partner Finance)) v Financial Ombudsman Service [2023] EWHC 1069 (Admin) (‘Shawbrook & BPF v FOS’). • Johnson v FirstRand Bank Ltd, Wrench v FirstRand Bank Ltd and Hopcraft v Close Brothers Ltd [2025] UKSC 33 (‘Hopcraft, Johnson and Wrench’). Relevant Guidance – Goode: Consumer Credit Law and Practice Goode: Consumer Credit Law and Practice is a widely recognised expert commentary on the application of the Consumer Credit Act 1974 and related legislation. It offers relevant guidance to certain of the matters at hand in this complaint. Good industry practice – the RDO Code The Timeshare Regulations provided a regulatory framework. But I’m also required to take into account, when appropriate, what I consider to have been good industry practice at the relevant time – which, in this complaint, includes the Resort Development Organisation’s Code of Conduct dated 1 January 2010 (the “RDO Code”). What I’ve provisionally decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Mrs L and Mr L’s complaint about their section 75 claim In certain situations, section 75 of the CCA provides a useful mechanism for a debtor to pursue a claim against their lender rather than (or as well as) the supplier of goods or services. Conditions must be met for section 75 to apply including, but not limited to, the cash price of the purchase and the nature of the arrangements between the parties involved in the transaction. Because of the way in which section 75 operates, if C is liable for having misrepresented something to Mrs L and Mr L at the Time of Sale or has breached its contract with them, that might give rise to a potential joint and several liability on the part of Shawbrook Bank. But it’s by no means guaranteed that such a claim will be successful. And if C has a defence to such a claim, that defence is also available to Shawbrook Bank. Shawbrook Bank has advanced a position in response to Mrs L and Mr L’s section 75 claim; namely that the Limitation Act affords it a complete defence. This was also the view our investigator reached in his assessment of the complaint. In bringing the complaint, and in seeking this review, S hasn’t provided any comment on the position Shawbrook Bank has taken. It has simply restated the claim of misrepresentation.

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As far as I understand it, Mrs L and Mr L’s claim in misrepresentation is made under section 2(1) of the Misrepresentation Act 1967. The relevant provision2 of the Limitation Act has the effect that an action [for damages] founded on tort3 cannot be brought more than six years after the cause of action accrued. Bearing in mind the High Court’s judgment in Green v. Eadie & Ors [2011] EWHC B24 (Ch), I find that Mrs L and Mr L’s alleged loss that is the cause of action accrued when they entered into the Purchase Agreement in May 2015. As their claim was not made until nearly nine years later, I see no reason why it would be unfair for Shawbrook Bank to seek to rely on the Limitation Act as a defence to that claim. I therefore don’t propose to uphold this aspect of Mrs L and Mr L’s complaint. Mrs L and Mr L’s complaint under section 140A Section 140A of the CCA says a court may make an order if it thinks the relationship between a creditor and a debtor is unfair to the debtor. It’s deliberately framed in wide terms, and a finding of unfairness can flow from something done on the creditor’s behalf in connection with a ‘related agreement’. Here, the Purchase Agreement is a ‘related agreement’. And, by virtue of section 56 of the CCA, Shawbrook Bank is legally answerable for C’s actions. It’s not entirely clear whether Shawbrook Bank has acted unfairly in applying the same defence under the Limitation Act as it did to Mrs L and Mr L’s section 75 claim. I don’t believe it correct to say the six-year time limit for a section 140A claim runs from their entry into the Credit Agreement. An assessment of unfairness under section 140A isn’t limited to what happened immediately before or at the time a credit agreement and related agreement were entered into. The High Court held in Patel4, that determining whether or not the relationship complained of was unfair had to be made “having regard to the entirety of the relationship and all potentially relevant matters up to the time of making the determination” – which was the date of the trial in the case of an existing credit relationship or otherwise the date the credit relationship ended. So, for as long as the Credit Agreement remained outstanding, Shawbrook Bank was responsible for the matters that might have made its relationship with Mrs L and Mr L unfair and for taking steps to remove the source of that unfairness or mitigate its consequences so that the relationship was no longer unfair. Accordingly, in alleging that they were subject to an unfair credit relationship under section 140A, Mrs L and Mr L’s complaint extends to Shawbrook Bank’s acts and omissions, in being party to such a relationship and perpetuating its unfairness, right up until the moment their credit relationship with it ended. According to the loan account records, Mrs L and Mr L repaid their account balance on 25 May 2018. This was the point at which their credit relationship with Shawbrook Bank ended. 2 Section 2 Limitation Act 1980. 3 I have proceeded on the understanding that the claim relates to the tort of negligent misrepresentation. It is possible to interpret the action as one intended to recover a sum by virtue of an enactment per section 9(1) of the Limitation Act 1980, but as this specifies the same six-year period, I haven’t found it necessary to distinguish. 4 Approved by the Supreme Court in Smith.

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I can understand why Shawbrook Bank has sought to rely on the Limitation Act in response to Mrs L and Mr L’s section 140A claim. Its final response letter of 11 September 2024 refers to receiving their complaint on 5 September 2024. That’s more than six years after the end of the credit relationship. But as I’ve noted, the Letter of Complaint from S was dated 20 March 2024, which was within six years of the end of Mrs L and Mr L’s credit relationship with Shawbrook Bank. So it’s possible the section 140A claim was brought within the time limit in the Limitation Act, even if the connected complaint was outside that time limit. With this in mind, it’s possible that Shawbrook Bank might not have been entitled to rely on the Limitation Act defence to Mrs L and Mr L’s section 140A claim. So I’ll set out my thoughts on that aspect of their complaint. The first thing I note is that the only witness testimony submitted is an undated single page statement from Mrs L and Mr L. The content of this statement doesn’t substantiate a number of points S has made on their behalf. For example, there’s nothing in the statement that suggests Mrs L and Mr L were put under undue pressure to purchase, that they found the sales presentation particularly lengthy or burdensome, or that they were not free to leave the presentation at any point. Mrs L and Mr L also say they were given a 14-day cooling off period. They didn’t at any point within that time seek to cancel the membership, as might be the case had they been subject to pressure from C at the Time of Sale. Nor is there any suggestion that they were unable to avail themselves of accommodation or in any way denied booking. Rather, Mrs L and Mr L’s testimony says that while there was a lot of wrangling with incentives and deal reductions, including a free vacation, the purchase seemed to them like a good idea at the time and so they agreed to sign up to the arrangements. They also say they “enjoyed the first few years, and were very happy with the overall service, cleanliness, and all amenities etc. including access to a concierge.” There’s no indication in Mrs L and Mr L's testimony that they were unhappy with any of the holiday arrangements until a new resort management was put in place following the Covid-19 pandemic, some years after the end of their credit relationship with Shawbrook Bank that is the subject of this complaint. Taking into account Mrs L and Mr L’s own evidence, I simply can’t see that many of the points S has sought to raise on their behalf could give rise to a successful claim of an unfair credit relationship under section 140A of the CCA. I now turn to the allegation that C breached Regulation 14(3) of the Timeshare Regulations by actively relying on the membership’s potential to provide an investment return. I’m satisfied that Mrs L and Mr L’s Fractional Club membership met the definition of a “timeshare contract” and was a “regulated contract” for the purposes of the Timeshare Regulations. Regulation 14(3) of the Timeshare Regulations prohibited C from marketing or selling Fractional Club membership as an investment. At the Time of Sale this provision said: “A trader must not market or sell a proposed timeshare contract or long-term holiday product contract as an investment if the proposed contract would be a regulated contract.”

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The term ‘investment’ is not defined in the Timeshare Regulations. But for the purposes of this provisional decision, and by reference to the decided authorities5, I will define an investment as being a transaction in which money or other property is laid out in the expectation or hope of financial gain or profit. A share in the Allocated Property clearly constituted an investment as it offered the prospect of a financial gain or profit – even if this ultimately didn’t come to fruition. But the fact that Fractional Club membership by nature contained that investment element did not, itself, transgress the prohibition in Regulation 14(3). That provision prohibits the marketing and selling of a timeshare contract as an investment. It doesn’t prohibit the mere existence of an investment element in a timeshare contract or prohibit the marketing and selling of such a timeshare contract per se. In other words, the Timeshare Regulations did not ban products such as the Fractional Club. They just regulated how such products were marketed and sold. I recognise that C’s sales process left open the possibility that the sales representative may have positioned Fractional Club membership as an investment; that is, it told them or led them to believe that Fractional Club membership offered them the prospect of a financial gain (a profit). And Mrs L and Mr L’s recollections of what was discussed about investment are set out in their witness statement. They say: “The product was sold as a new thing involving fractionals, [where] we owned a fraction of the property, with a return our investment6 upon sale of said property after the end of the agreed term. After a lot of wrangling with both incentives and deal reductions which also included another free vacation, we agreed to sign on the same day in their offices. This seemed like a good idea at the time, for an investment and worked out cheaper than we were currently paying out for holidays. Also the decision to buy into this product was taken on the understanding that this was a members only exclusive club.” Against this, it is clear from the sales documents Mrs L and Mr L signed that C made efforts to avoid specifically describing membership of the Fractional Club as an ‘investment’ or quantifying to prospective purchasers such as Mrs L and Mr L, the financial value of her share in the net sales proceeds of the Allocated Property along with the investment considerations, risks and rewards attached to them. Even if Fractional Club membership was marketed and sold to Mrs L and Mr L as an investment in breach of Regulation 14(3), I return to the point made in Plevin, which makes clear that regulatory breaches do not automatically create unfairness for the purposes of that provision. Such breaches and their consequences (if there are any) must be considered in the round, rather than in a narrow or technical way. So whether there was a breach of the relevant prohibition by C isn’t ultimately determinative of an unfair credit relationship. Rather, it’s a factor that might – depending on other circumstances – lead to that position. I’ve therefore considered whether, if there was a breach of Regulation 14(3), that was what led Mrs L and Mr L to enter into the Purchase Agreement and Credit Agreement. 5 Shawbrook & BPF v FOS 6 Due to the missing word here, it’s unclear whether Mrs L and Mr L are referring to a return on their investment, or a return of their investment. While that has a bearing on whether C led them to believe that membership offered them the prospect of a financial gain, for reasons I will go on to explain I don’t consider this the determining factor in their claim.

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I’m not satisfied that I can safely reach that conclusion. Mrs L and Mr L’s purchase was motivated by a range of factors. I’ve already noted that Mrs L and Mr L discussed sales incentives with C. And it would be surprising if they had entered into a holiday contract without being interested in the accommodation and amenities membership brought. Their witness statement makes rather more of the exclusivity and the holiday benefits they received under Fractional Club membership than it does about the prospect of making a financial gain on an investment. So whether or not C marketed or sold the Fractional Club membership as an investment in breach of Regulation 14(3) of the Timeshare Regulations, the available evidence doesn’t persuade me that Mrs L and Mr L’s decision to purchase Fractional Club membership at the Time of Sale was motivated by the prospect of a financial gain (that is, a profit). I’ve no reason to think they would not have pressed ahead with their purchase irrespective of any breach of Regulation 14(3). Because of this, I can’t agree that this aspect of the complaint caused the credit relationship between Mrs L and Mr L and Shawbrook Bank to be unfair to them. Finally, S said that there are some unfair contract terms in the Purchase Agreement. However, it hasn’t provided any evidence that those terms were operated unfairly against Mrs L and Mr L in practice, nor that such terms led them to behave in a way that was to their detriment. I’m therefore not persuaded that any of the terms governing the Fractional Club membership are likely to have led to an unfairness that warrants a remedy. Other matters raised in the course of the complaint In November 2024, on behalf of all of its clients including Mrs L and Mr L, S made a general assertion that the payment of commission made the financial arrangements unfair. S didn’t give a level of commission at which it considered unfairness arose, but its arguments included the following: • Despite requests, there had been no disclosure of the actual amount of commission paid by Shawbrook Bank to C. • per the Court of Appeal’s judgment in Johnson7, the percentage of commission should be based upon “the sum borrowed”. • the amount of the annual percentage rate of interest (“APR”) is key and was unusually high, substantially increasing the total charge for credit. • Commission paid by C to its self-employed sales representatives should also be disclosed and taken into account in the calculation used to determine unfairness. While the Letter of Complaint contained no assertion in relation to commission, it is relevant to the question of whether the credit relationship between Mrs L and Mr L and Shawbrook Bank was unfair. So I’ve thought about the arrangements in that context. My reading of the Supreme Court’s judgment in Hopcraft, Johnson and Wrench is that it sets out principles which can apply to credit brokers other than car dealer–credit brokers. So I’ve taken into account those principles when considering the allegations of undisclosed payments of commission in this complaint. In Hopcraft, Johnson and Wrench the Supreme Court ruled that, in each of the three cases, commission payments made to car dealers by lenders were legal, as claims for the 7 S’s submission references the Court of Appeal judgment (Johnson v FirstRand Bank Limited, Wrench v FirstRand Bank Limited and Hopcraft v Close Brothers [2024] EWCA Civ 1106 (“Johnson”)). The Supreme Court has since handed down its judgment clarifying the position in law.

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tort of bribery, or the dishonest assistance of a breach of fiduciary duty, had to be predicated on the car dealer owing a fiduciary duty to the consumer, which the car dealers did not owe. A “disinterested duty”, as described in Wood v Commercial First Business Ltd & ors and Business Mortgage Finance 4 plc v Pengelly [2021] EWCA Civ 471, is not enough. However, the Supreme Court held that the credit relationship between the lender and Mr Johnson was unfair under section 140A of the CCA because of the commission paid by the lender to the car dealer. The main reasons for coming to that conclusion included, amongst other things, the following factors: • The size of the commission (as a percentage of the total charge for credit). In Mr Johnson’s case it was 55%. This was “so high” and “a powerful indication that the relationship…was unfair”8; • The failure to disclose the commission; and • The concealment of the commercial tie between the car dealer and the lender. The Supreme Court also confirmed that the following factors, in what was a non- exhaustive list, will normally be relevant when assessing whether a credit relationship was/is unfair under section 140A of the CCA: • The size of the commission as a proportion of the charge for credit; • The way in which commission is calculated (a discretionary commission arrangement, for example, may lead to higher interest rates); • The characteristics of the consumer; • The extent of any disclosure and the manner of that disclosure (which, insofar as section 56 of the CCA is engaged, includes any disclosure by a supplier when acting as a broker); and • Compliance with the regulatory rules. However, I don’t think Hopcraft, Johnson and Wrench assists Mrs L and Mr L in arguing that their credit relationship with Shawbrook Bank was unfair to them for reasons relating to commission, given the facts and circumstances of this complaint. I haven’t seen anything to suggest Shawbrook Bank and C were tied to one another contractually or commercially in a way that wasn’t properly disclosed to Mrs L and Mr L. Nor have I seen anything that persuades me that the commission arrangements between them gave C a choice over the interest rate that led Mrs L and Mr L into a credit agreement that cost disproportionately more than it otherwise could have. I recognise that it’s possible Shawbrook Bank and C failed to follow the regulatory guidance in place at the Time of Sale insofar as it was relevant to disclosing the commission arrangements between them. But case law on section 140A makes clear that regulatory breaches do not automatically lead to an unfair credit relationship, and that such breaches and any consequences must be considered in the round rather than in a narrow or technical way. With that being the case, even if Shawbrook Bank and C failed to follow the relevant regulatory guidance at the Time of Sale, I’m not minded to think any such failure is itself a reason to find the credit relationship in question unfair to Mrs L and Mr L. 8 Hopcraft, Johnson and Wrench (para 327).

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I say this because, in stark contrast to the facts in Mr Johnson’s case, Shawbrook Bank has provided evidence that there was no payment of commission to C for arranging Mrs L and Mr L’s Credit Agreement. I can’t see, therefore, that any of the arguments made around a failure to disclose that fact could possibly succeed, particularly as it can’t be shown that Mrs L and Mr L would have made a different decision about whether to take out the loan had they known there was no commission. What’s more, based on what I’ve seen so far, C’s role as a credit broker wasn’t a separate service and distinct from its role as the seller of timeshares. It was simply a means to an end in C’s overall pursuit of a successful timeshare sale. I can’t see that C gave an undertaking – either expressly or impliedly – to put to one side its commercial interests in pursuit of that goal when arranging the Credit Agreement. As it wasn’t acting as an agent of Mrs L and Mr L but as the supplier of contractual rights they obtained under the Purchase Agreement, the transaction doesn’t strike me as one with features that suggest C had an obligation of ‘loyalty’ to them when arranging the Credit Agreement and thus a fiduciary duty. I don’t consider it necessary for me to take into account any commission C might have paid to its sales representatives, or that this should be disclosed or factored into any calculation used to determine unfairness. Even if any such arrangement was in place (and I make no finding in this respect), its disclosure and/or payment would be further removed from any obligations C might have held, and even less likely to have an impact on Mrs L and Mr L’s decision to enter into the Credit Agreement. I'm aware of the factors S feels should be taken into account in calculating the loan APR and commission. However, I'm satisfied it's appropriate that I follow the approach set out in the Supreme Court judgment. Overall, I’m don’t intend to conclude that the commission arrangements between Shawbrook Bank and C were likely to have led to a sufficiently extreme inequality of knowledge that rendered the credit relationship unfair to Mrs L and Mr L. Summary conclusion In conclusion, given the facts and circumstances of this complaint, I don’t think Shawbrook Bank acted unfairly when it declined Mrs L and Mr L’s section 75 claim. And I’m not persuaded that Shawbrook Bank was party to a credit relationship with them under the Credit Agreement and related Purchase Agreement that was unfair to them for the purposes of section 140A. And having taken everything into account, I see no other reason why it would be fair to direct Shawbrook Bank to compensate Mrs L and Mr L. Responses to my provisional decision Shawbrook Bank accepted my intended conclusions. S, responding on Mrs L and Mr L’s behalf, didn’t accept my provisional decision saying, in summary: • The provisional decision placed significant reliance on the perceived limitations of Mrs L and Mr L’s witness statement, which couldn’t reasonably be expected to reproduce every detail of the sales environment. • The provisional decision applied too high a threshold when considering whether the investment aspect of the purchase was the sole cause of the transaction. The representations C made in this respect were sufficient to have materially influenced Mrs L and Mr L’s purchase decision.

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• The sales environment was such that it could create a sense of urgency and pressure that discouraged potential purchasers from extended reflection or independent advice before entering into a significant financial commitment. • The absence of a commission payment notwithstanding, the fairness of the credit relationship must be considered in the context of the supplier’s role in arranging the finance and facilitating the underlying transaction. • The provisional decision did not appear to address in detail the creditworthiness and affordability assessment undertaken by Shawbrook Bank when the agreement was approved. • To the extent that the provisional conclusions relied upon representations made by the lender, it would be useful to have summarised in bullet-point form the key points advanced by Shawbrook Bank together with any documentary evidence relied upon. • When taken as a whole, the cumulative effect of the factors S mentioned indicates a relationship characterised by a significant informational imbalance between supplier, lender and consumer. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. I’d like to thank S for its concise response and the clarity of its additional submissions. However, after considering the case afresh and having regard for what’s been said in response to my provisional decision, I find no persuasive reason to depart from the conclusions I’ve previously set out. I’ll explain why. S hasn’t sought to challenge my conclusion in respect of Mrs L and Mr L’s section 75 claim, which I addressed in my provisional decision. My finding on this point remains that Shawbrook Bank did not act unfairly in seeking to rely on the Limitation Act provisions to defend the claim. It follows that I don’t uphold this aspect of the complaint, for the reasons I set out in my provisional decision and which I adopt as part of this final decision. I turn now to the points S has made in response. These relate to the issue of whether the credit relationship between Mrs L and Mr L and Shawbrook Bank was unfair per section 140A of the CCA. S expressed the view that my provisional decision misunderstood or placed insufficient weight on key aspects that might give rise to an unfair credit relationship. S provided more comment in relation to the sales environment and whether the membership was sold to Mrs L and Mr L as an investment at the Time of Sale. S also sought to raise questions over the creditworthiness assessment carried out at the time of the lending decision, and the substance of Shawbrook Bank’s submissions. On this point, S has asked if it could be supplied with a summary of the submissions Shawbrook Bank has made. For the most part, S already has Shawbrook Bank’s submissions; they comprise the purchase and loan documents, and the bank’s final response letter which sets out its position. Where we have required clarity, such as in the matter of whether commission has been paid, I have set out in my provisional decision what Shawbrook Bank has told us.

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Noting S’s request to reproduce this in bullet-point form: • Shawbrook Bank has informed us that it paid C no commission in relation to the sale that is the subject of Mrs L and Mr L’s claim. Turning now to the other points S has made, while I note S’s comments I don’t agree that I’ve placed an inappropriate amount of weight on Mrs L and Mr L’s personal recollections, however brief their account of events might be. They were present at the Time of Sale and they are the clients bringing the complaint. Their evidence is highly relevant when considering what’s likely to have happened at the Time of Sale, and their motivation for purchasing membership. If they did not themselves mention certain aspects relating to the sale, it is no reason for me to disregard what they did say, or to draw inferences about what they might have said had their statement been more detailed. I remind S that in my provisional decision I accepted the possibility that Fractional Club membership was marketed and/or sold to Mrs L and Mr L as an investment, in breach of Regulation 14(3). I went on to explain that relevant case law9 indicates that in considering the question of relief for any resultant unfairness in the credit relationship, I needed to take into account any material impact of such a breach on Mrs L and Mr L’s decision whether to enter into the Purchase and Credit Agreements. My provisional findings were that Mrs L and Mr L’s Fractional Club membership did include an investment (a profit) element, that it was possible that it was marketed and sold to them in that way in breach of Regulation 14(3), but that there was no persuasive evidence that a profit motive had been a material factor in Mrs L and Mr L’s decision to purchase membership. Contrary to what S has said, I haven’t suggested that investment needed to be the sole factor influencing that decision. Rather, my finding was that the evidence wasn’t sufficiently persuasive that Mrs L and Mr L’s purchase decision would have been any different, given the other motivational factors they described. Having re-examined Mrs L and Mr L’s statement that remains my view, for the reasons previously given. So as I said before, whether or not C marketed or sold Fractional Club membership as an investment in breach of Regulation 14(3), I’m not persuaded Mrs L and Mr L’s decision to make the purchase was materially impacted by the prospect of a financial gain. It follows that I find the credit relationship between Mrs L and Mr L and Shawbrook Bank was not rendered unfair to them for this reason. S has said that the absence of a commission payment doesn’t remove the potential for unfairness within the overall credit relationship. It suggests that the context of the sale was such that the arrangement of finance (to facilitate the purchase) must be considered, raising the question of any creditworthiness assessment Shawbrook Bank carried out. It seems a touch surprising that such a matter wasn’t raised significantly earlier in the overall proceedings, were it genuinely an issue of concern to Mrs L and Mr L. I note that neither their witness statement nor the Letter of Claim mention any concerns in this respect. The information they provided at the Time of Sale about their financial situation isn’t suggestive that borrowing the £3,368 that S has said their claim relates to was likely to cause them any affordability issues. And I must also bear in mind that Mrs L and Mr L settled the loan in full only three years after taking it out, which again isn’t suggestive of a lack of creditworthiness, regardless of any assessment Shawbrook Bank undertook before agreeing to lend to them. 9 Carney and Kerrigan

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In the circumstances, and returning once again to the point made in Plevin that regulatory breaches do not automatically create unfairness, I do not consider it necessary to probe further into any creditworthiness assessment that Shawbrook Bank undertook. Further, I’m satisfied Shawbrook Bank has provided sufficient information in response to my enquiries to enable me to reach a conclusion about its commission arrangements with C. I’ve seen nothing in this case that leads me to think what Shawbrook Bank has said about there being no commission paid is inaccurate. So there's no reason for me to reach a different finding over those commission arrangements. Given all of the factors I’ve looked at in this part of my decision, and having taken them all into account, I remain unpersuaded that the credit relationship between Mrs L and Mr L and Shawbrook Bank was unfair to them under section 140A of the CCA such that it warrants the bank offering any redress. Summary Overall, there is nothing that S has said in response to my provisional decision that points me towards reaching a different set of conclusions, or gives me good reason not to adopt my provisional findings in full as part of this final decision. Accordingly, for the reasons I’ve set out here and in my provisional decision, I remain of the opinion that Shawbrook Bank did not act unfairly or unreasonably when it dealt with Mrs L and Mr L’s Section 75 claim, or that it was party to a credit relationship with them that was unfair for the purposes of Section 140A of the CCA. My final decision My final decision is that I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mrs L and Mr L to accept or reject my decision before 17 April 2026. Niall Taylor Ombudsman

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