Shawbrook Bank Limited · DRN-6259556

The complaint Mr and Mrs F’s complaint is, in essence, that Shawbrook Bank Limited (the ‘Lender’) acted unfairly and unreasonably by (1) being party to an unfair credit relationship with them under Section 140A of the Consumer Credit Act 1974 (as amended) (the ‘CCA’) and (2) deciding against paying a claim under Section 75 of the CCA. What happened Mr and Mrs F were the members of a timeshare provider (the ‘Supplier’) – having purchased products from it previously. But the product at the centre of this complaint is their membership of a timeshare that I’ll call the ‘Fractional Club’ – which they bought on 15 October 2015 (the ‘Time of Sale’). They entered into an agreement with the Supplier to buy 1800 fractional points at a cost of £9,005.00 (the ‘Purchase Agreement’). Fractional Club membership was asset backed – which meant it gave Mr and Mrs F more than just holiday rights. It also included a share in the net sale proceeds of a property named on the Purchase Agreement (the ‘Allocated Property’) after their membership term ends. Mr and Mrs F paid for their Fractional Club membership by taking finance of £23,038 from the Lender (‘Credit Agreement, this loan also consolidated the outstanding balance of their previous loan) Mr and Mrs F – using a professional representative (the ‘PR’) – wrote to the Lender on 30 June 2022 (the ‘Letter of Complaint’) to raise a number of different concerns. As those concerns haven’t changed since they were first raised, and as both sides are familiar with them, it isn’t necessary to repeat them in detail here beyond the summary above. The Lender dealt with Mr and Mrs F’s concerns as a complaint and issued its final response letter on 15 March 2024, rejecting it. The complaint was then referred to the Financial Ombudsman Service. It was assessed by an Investigator who, having considered the information on file, rejected the complaint on its merits. Mr and Mrs F disagreed with the Investigator’s assessment and asked for an Ombudsman’s decision – which is why it was passed to me. I considered the matter and issued a provisional decision (the ‘PD’) dated 22 March 2026. In that decision, I said: Section 75 of the CCA: the Supplier’s misrepresentations at the Time of Sale In this part of Mr and Mrs F’ complaint, they are alleging that the Lender ought to have allowed their Section 75 claim as there were misrepresentations made by the Supplier at the Time of Sale, and these misrepresentations induced them into making the purchase.

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The Investigator in this case felt it would be reasonable for the Lender to reject this element of their complaint as the Lender would have a defence to it under the Limitation Act 1980 (the ‘LA’). Creditors can reasonably reject Section 75 claims that they’re first informed about after the claim has become time-barred under the LA. The reason being, that it wouldn’t be fair to expect creditors to look into such claims so long after the liability arose and after a limitation defence would be available in court. Having considered everything, I agree with what the Investigator has said here. I think Mr and Mrs F’ claim for misrepresentation was likely to have been made too late under the relevant provisions of the LA, which means it would have been fair for the Lender to have turned down a Section 75 claim for this reason. A claim under Section 75 is a ‘like’ claim against the creditor. A claim for misrepresentation against the Supplier would ordinarily be made under Section 2(1) of the Misrepresentation Act 1967. And the limitation period to make such a claim expires six years from the date on which the cause of action accrued, as per Section 2 of the LA. But a claim like this one under Section 75 is also “an action to recover any sum by virtue of any enactment” under Section 9 of the LA. The limitation period under that provision is also six years from the date on which the cause of action accrued. The date on which the cause of action accrued was the Time of Sale. I say this because Mr and Mrs F entered into the membership at that time based on the alleged misrepresentations by the Supplier, which Mr and Mrs F says they relied on. And, as the loan from the Lender was used to finance this membership, it was when Mr and Mrs F entered into the Credit Agreement that they suffered a loss. Mr and Mrs F first notified the Lender of his Section 75 claim on 30 June 2022. Since this was more than six years after the Time of Sale, I don’t think the Lender acted unfairly or unreasonably when it rejected Mr and Mrs F’ concerns about the Supplier’s alleged misrepresentations at the Time of Sale. Section 140A of the CCA: did the Lender participate in an unfair credit relationship? I’ve already explained why I’m not persuaded that Fractional Club membership was actionably misrepresented by the Supplier at the Time of Sale. But there are other aspects of the sales process that, being the subject of dissatisfaction, I must explore with Section 140A in mind if I’m to consider this complaint in full – which is what I’ve done next. Having considered the entirety of the credit relationship between Mr and Mrs F and the Lender along with all of the circumstances of the complaint, I don’t think the credit relationship between them was likely to have been rendered unfair for the purposes of Section 140A. When coming to that conclusion, and in carrying out my analysis, I have looked at: 1. The standard of the Supplier’s commercial conduct – which includes its sales and marketing practices at the Time of Sale along with any relevant training material; 2. The provision of information by the Supplier at the Time of Sale in relation to Fractional Club membership, including the contractual documentation and disclaimers made by the Supplier; 3. The commission arrangements between the Lender and the Supplier at the Time of Sale and the disclosure of those arrangements; 4. Evidence provided by both parties on what was likely to have been said and/or done

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at the Time of Sale; 5. The inherent probabilities of the sale given its circumstances; and, when relevant 6. Any existing unfairness from a related credit agreement. I have then considered the impact of these on the fairness of the credit relationship between Mr and Mrs F and the Lender. The Supplier’s sales & marketing practices at the Time of Sale Mr and Mrs F’s complaint about the Lender being party to an unfair credit relationship was made for several reasons. The PR says, for instance, that the right checks weren’t carried out before the Lender lent to Mr and Mrs F. I haven’t seen anything to persuade me that was the case in this complaint given its circumstances. But even if I were to find that the Lender failed to do everything it should have when it agreed to lend (and I make no such finding), I would have to be satisfied that the money lent to Mr and Mrs F was actually unaffordable before also concluding that they lost out as a result and then consider whether the credit relationship with the Lender was unfair to them for this reason. But from the information provided, I am not satisfied that the lending was unaffordable for the Mr and Mrs F. Connected to this is the suggestion by the PR that the Credit Agreement was arranged by an unauthorised credit broker, the upshot of which is to suggest that the Lender wasn’t permitted to enforce the Credit Agreement. However, it looks to me like Mr and Mrs F knew, amongst other things, how much they were borrowing and repaying each month, who they were borrowing from and that they were borrowing money to pay for Fractional Club membership. And as the lending doesn’t look like it was unaffordable for them, even if the Credit Agreement was arranged by a broker that didn’t have the necessary permission to do so (which I make no formal finding on), I can’t see why that led to Mr and Mrs F financial loss – such that I can say that the credit relationship in question was unfair on them as a result. And with that being the case, I’m not persuaded that it would be fair or reasonable to tell the Lender to compensate them, even if the loan wasn’t arranged properly. The PR also says that there was one or more unfair contract terms in the Purchase Agreement. But as I can’t see that any such terms were operated unfairly against Mr and Mrs F in practice, nor that any such terms led them to behave in a certain way to their detriment, I’m not persuaded that any of the terms governing Fractional Club membership are likely to have led to an unfairness that warrants a remedy. I acknowledge that Mr and Mrs F may have felt weary after a sales process that went on for a long time. But they say little about what was said and/or done by the Supplier during their sales presentation that made them feel as if they had no choice but to purchase Fractional Club membership when they simply did not want to. They were also given a 14-day cooling off period and they have not provided a credible explanation for why they did not cancel their membership during that time. And with all of that being the case, there is insufficient evidence to demonstrate that Mr and Mrs F made the decision to purchase Fractional Club membership because their ability to exercise that choice was significantly impaired by pressure from the Supplier. Overall, therefore, I don’t think that Mr and Mrs F credit relationship with the Lender was rendered unfair to them under Section 140A for any of the reasons above. But there is another reason, perhaps the main reason, why the PR says the credit relationship with the Lender was unfair to them. And that’s the suggestion that Fractional Club membership was marketed and sold to them as an investment in breach of prohibition against selling timeshares in that way.

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The Supplier’s alleged breach of Regulation 14(3) of the Timeshare Regulations The Lender does not dispute, and I am satisfied, that Mr and Mrs F’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 the Supplier from marketing or selling Fractional Club membership as an investment. This is what the provision said at the Time of Sale: “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.” But the PR says that the Supplier did exactly that at the Time of Sale – saying, in summary, that Mr and Mrs F were told by the Supplier that Fractional Club membership was the type of investment that would only increase in value. The term “investment” is not defined in the Timeshare Regulations. But for the purposes of this provisional decision, and by reference to the decided authorities, an investment is 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 Mr and Mrs F the prospect of a financial return – whether or not, like all investments, that was more than what they first put into it. But it is important to note at this stage that the fact that Fractional Club membership included an 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. To conclude, therefore, that Fractional Club membership was marketed or sold to Mr and Mrs F as an investment in breach of Regulation 14(3), I have to be persuaded that it was more likely than not that the Supplier marketed and/or sold membership to them as an investment, i.e. told them or led them to believe that Fractional Club membership offered them the prospect of a financial gain (i.e., a profit) given the facts and circumstances of this complaint. There is competing evidence in this complaint as to whether Fractional Club membership was marketed and/or sold by the Supplier at the Time of Sale as an investment in breach of regulation 14(3) of the Timeshare Regulations. On the one hand, it is clear that the Supplier made efforts to avoid specifically describing membership of the Fractional Club as an ‘investment’ or quantifying to prospective purchasers, such as Mr and Mrs F, the financial value of their share in the net sales proceeds of the Allocated Property along with the investment considerations, risks and rewards attached to them. On the other hand, I acknowledge that the Supplier’s sales process left open the possibility that the sales representative may have positioned Fractional Club membership as an investment. So, I accept that it’s equally possible that Fractional Club membership was marketed and sold to Mr and Mrs F as an investment in breach of Regulation 14(3). However, whether or not there was a breach of the relevant prohibition by the Supplier is not ultimately determinative of the outcome in this complaint for reasons I will come on to

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shortly. And with that being the case, it’s not necessary to make a formal finding on that particular issue for the purposes of this decision. Was the credit relationship between the Lender and the Consumer rendered unfair? Having found that it was possible that the Supplier breached Regulation 14(3) of the Timeshare Regulations at the Time of Sale, I now need to consider what impact that breach had on the fairness of the credit relationship between Mr and Mrs F and the Lender under the Credit Agreement and related Purchase Agreement as the case law on Section 140A makes it 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. Indeed, it seems to me that, if I am to conclude that a breach of Regulation 14(3) led to a credit relationship between Mr and Mrs F and the Lender that was unfair to them and warranted relief as a result, whether the Supplier’s breach of Regulation 14(3) led them to enter into the Purchase Agreement and the Credit Agreement is an important consideration. On my reading of the evidence before me, the prospect of a financial gain from the Fractional Club membership was not an important and motivating factor when Mr and Mrs F made the decision to purchase it. That doesn’t mean they weren’t interested in a share in the Allocated Property. After all, that wouldn’t be surprising given the nature of the product at the centre of this complaint. But I’m conscious that the original Letter of Complaint makes no specific assertion about why Mr and Mrs F decided to purchase the Fractional Club membership. The submissions at that point focused on the use of the term ‘investment’. The PR provided Mr and Mrs F’s statement which is undated although the pdf file name is ‘SOM26.10.2021’ perhaps implying that 26 October 2021 is the date it was typed. It is not signed although it commences with the words, Statement (Misrepresentation or unfulfilled promises during the sales process) Mr F and Mrs F declare: This was provided to us by the PR on 9 March 2026 and is some eight pages in length. It covers a variety of issues which have helpfully been described under the following subheadings, Introduction to Club La Costa Trial Membership Fractional Property Owners Club Signature Collection Fractional Ownership Maintenance/Management Charges Using the Signature Suite Misrepresentation issues In it all that is said in relation to the issue of investment is; We were told that the property would be sold after 19 years and that we would receive a share of the sale price including profits and that we should consider this option not only as a holiday solution but also an investment. And

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Our decision to upgrade to Signature Collection was based entirely on the promise of it being an investment opportunity, the sale of the property in 19 years and the share of the sale and profits. Within the context of a lengthy statement, this is a limited recollection of what the Supplier told them surrounding the issue of investment. I can see that their statement indicates they were told that they would receive a share of the sale proceeds and profits. This of course affirms that they understood that by buying Fractional Club membership they would get some money back when the Allocated Property was sold. Receiving a share of the sale proceeds does not necessarily translate to recovering any investment since the property or asset purchased may go down in value. And whilst I accept what they have said about profit, I don’t think this satisfies the test I must consider. I would need to be persuaded that what they were told was material to their purchasing decision i.e. they would not have bought it were it not for the Supplier’s breach of Regulation 14(3). It is here that I must also consider the rest of their statement and not just focus on the two quotations I have mentioned above. When their statement is read in its entirety, it indicates that their purchase of the membership was motivated principally by holidays they and their family would be able to have in the future. A large portion of the statement dwells on the quality of the apartments, the locations, the facilities and benefits membership offered, but also on the cost effectiveness of membership when contrasted with the cost of taking holidays in the more traditional or straightforward manner. I also take note of the absence of any mention in the Letter of Complaint about Mr and Mrs F’s reasons for their purchase and balance that against what they say later in their statement. As I have said, it seems to me on my reading of what they have said, that they made the Fractional Club purchase for the holidays the membership could provide to them, having had a trial membership previously, not that it was made for an investment. In addition, part of my assessment of their witness evidence must necessarily include when their statement was written, and whether it may have been affected by external factors such as the widespread publication of the judgment handed down in Shawbrook and BPF v FOS. I cannot be confident as to when the statement was written as it bears no date, and I only know that it was not provided to this service until 9 March 2026, which is well after the outcome of Shawbrook and BPF v FOS. There is a real risk, therefore, that their testimony was coloured by the outcome of the above case and on balance, and the way in which the evidence has been provided makes me conclude that I must be cautious as to the weight I can assign to it. As Mr and Mrs F themselves don’t persuade me that their purchase was motivated by their share in the Allocated Property and the possibility of a profit, I don’t think a breach of Regulation 14(3) by the Supplier was likely to have been material to the decision Mr and Mrs F ultimately made. On balance, therefore, even if the Supplier had marketed or sold the Fractional Club membership as an investment in breach of Regulation 14(3) of the Timeshare Regulations, I am not persuaded that Mr and Mrs F’s decision to purchase Fractional Club membership at the Time of Sale was motivated by the prospect of a financial gain (i.e., a profit). On the contrary, I think the evidence suggests they would have pressed ahead with their purchase whether or not there had been a breach of Regulation 14(3). And for that reason, I do not think the credit relationship between Mr and Mrs F and the Lender was unfair to them even if the Supplier had breached Regulation 14(3).

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The effect of the Supplier entering liquidation PR says the sales companies of the Supplier started liquidation proceedings in December 2020 and this has deprived Mr and Mrs F of the opportunity to recover monies through the Spanish Court. But PR hasn’t explained why this is relevant to the complaint about the Lender. In any event, it is unclear how this action could have resulted in any unfairness in the relationship between Mr and Mrs F and the Lender. My provisional decision In conclusion, given the facts and circumstances of this complaint, I do not think that the Lender acted unfairly or unreasonably when it dealt with Mr and Mrs F Section 75 claim, and I am not persuaded that the Lender was party to a credit relationship with them under the Credit Agreement that was unfair to them for the purposes of Section 140A of the CCA. And having taken everything into account, I see no other reason why it would be fair or reasonable to direct the Lender to compensate them. The Lender responded to the PD and accepted it. The PR also responded – they did not accept the PD and provided some further comments and evidence they wish to be considered. Having received the relevant responses from both parties, I’m now finalising my decision. 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. The legal and regulatory context that I think is relevant to this complaint is, in many ways. no different to that shared in several hundred published ombudsman decisions on very similar complaints – which can be found on the Financial Ombudsman Service’s website. And with that being the case, it is not necessary to set out that context in detail here. But I would add that the following regulatory rules/guidance are also relevant:

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The Consumer Credit Sourcebook (‘CONC’) – Found in the Financial Conduct Authority’s (the ‘FCA’) Handbook of Rules and Guidance Below are the most relevant provisions and/or guidance as they were at the relevant time: • CONC 3.7.3 [R] • CONC 4.5.3 [R] • CONC 4.5.2 [G] The FCA’s Principles The rules on consumer credit sit alongside the wider obligations of firms, such as the Principles for Businesses (‘PRIN’). Set out below are those that are most relevant to this complaint: • Principle 6 • Principle 7 • Principle 8 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. Following the responses from both parties, I’ve considered the case afresh and having done so, I’ve reached the same decision as that which I outlined in my provisional findings, for broadly the same reasons. Again, my role as an Ombudsman isn’t to address every single point which has been made to date, but to decide what is fair and reasonable in the circumstances of this complaint. If I haven’t commented on, or referred to, something that either party has said, this doesn’t mean I haven’t considered it. Rather, I’ve focused here on addressing what I consider to be the key issues in deciding this complaint and explaining the reasons for reaching my final decision. The PR’s further comments in response to the PD in the main relate to the issue of whether the credit relationship between Mr and Mrs F and the Lender was unfair. In particular, the PR has provided further comments in relation to whether the membership was sold to Mr and Mrs F as an investment at the Time of Sale. They’ve also now argued for the first time that the payment of a commission by the Lender to the Supplier led to an unfair credit relationship. As outlined in my PD, the PR originally raised various other points of complaint, all of which I addressed at that time. But they didn’t make any further comments in relation to those in their response to my PD. Indeed, they haven’t said they disagree with any of my provisional conclusions in relation to those other points. And since I haven’t been provided with anything more in relation to those other points by either party, I see no reason to change my conclusions in relation to them as set out in my PD. So, I’ll focus here on the PR’s points raised in response. Section 140A of the CCA: did the Lender participate in an unfair credit relationship?

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The Supplier’s alleged breach of Regulation 14(3) of the Timeshare regulations As I explained in my PD, the PR’s original Letter of Complaint makes no specific assertion about why Mr and Mrs F decided to purchase the Fractional Club membership. This omission raises the question of why, and there has been no satisfactory explanation for the same. This necessarily feeds into the weight I can give to Mr and Mrs F’s statement, which as I said in my PD, is not signed and is not dated. I have already acknowledged that this statement may well have been prepared on 26 October 2021, since that is the name of the pdf file containing the statement, but if that is correct, then I have to question why the issues raised in it, relevant to the issue of investment, were not raised in the Letter of Complaint. And as I have said in my PD, it was only sent to this service on 9 March 2026, which is over 10 years after the relevant purchase. The PR has now provided a screen shot which it states is from a claims company which collected the statement. This screen shot is described as a ‘snippet’ from a database and provides no information which could possibly link it to being Mr and Mrs F’s statement, save for a date which corresponds to the name of the pdf sent to this service as I describe above. There is no reference for example to Mr or Mrs F’s name. Nevertheless, and despite being able to give it only limited weight, I shall not repeat what I said about the statement (since it is set out above), but I remain of the view that it is extremely limited in the evidence it provides regarding the issue of investment. The PR has not provided any further material information which would or could cause me to change my provisional view. So, having read Mr and Mrs F’s statement once more, they have said little about what it was that the Supplier said to them, or provided to them, that led them to believe the Allocated Property would only increase in value, or that they would make a profit. When reading the statement in its entirety, I am left with the impression that their purchase of the membership was motivated principally by the quality of the apartments, the locations, the facilities and benefits the membership offered, as well as the cost effectiveness of membership when compared with the cost of taking holidays in an alternative fashion. The test I need to consider is whether what Mr and Mrs F were told was material to their purchasing decision i.e. they would not have bought it were it not for the Supplier’s breach of Regulation 14(3), and I don’t think in these circumstances that the test can be said to have been met. So, ultimately, for the above reasons, along with those I already explained in my PD, I remain unpersuaded that any breach of Regulation 14(3) was material to Mr and Mrs F’s purchasing decision. The PR also said that in the judgment handed down in Shawbrook & BPF v FOS, it was not challenged that the product in question was marketed and sold as an investment. But, as I explained in my provisional decision, the Timeshare Regulations did not ban products such as the Fractional Club. They just regulated how such products were marketed and sold. And the judgment referred to did not make a blanket finding that all such products were mis-sold in the way the PR appears to be suggesting. Any complaint needs to be considered in the light of its specific circumstances. So, as I said before, even if the Supplier had marketed or sold the membership as an investment in breach of Regulation 14(3) (which I still make no finding on here), I’m not persuaded Mr and Mrs F’s decision to make the purchase was motivated by the prospect of

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a financial gain. So, I still don’t think the credit relationship between Mr and Mrs F and the Lender was unfair to them for this reason. The provision of information by the Supplier at the Time of Sale The PR says that a payment of commission from the Lender to the Supplier at the Time of Sale should lead me to uphold this complaint because, simply put, information in relation to that payment went undisclosed at the Time of Sale. As both sides already know, the Supreme Court handed down an important judgment on 1 August 2025 in a series of cases concerned with the issue of commission: Johnson v FirstRand Bank Ltd, Wrench v FirstRand Bank Ltd and Hopcraft v Close Brothers Ltd [2025] UKSC 33 (‘Hopcraft, Johnson and Wrench’). The Supreme Court ruled that, in each of the three cases, the commission payments made to car dealers by lenders were legal, as claims for the 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: 1. 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” (see paragraph 327); 2. The failure to disclose the commission; and 3. 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: 1. The size of the commission as a proportion of the charge for credit; 2. The way in which commission is calculated (a discretionary commission arrangement, for example, may lead to higher interest rates); 3. The characteristics of the consumer; 4. 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 5. Compliance with the regulatory rules. From my reading of the Supreme Court’s judgment in Hopcraft, Johnson and Wrench, it sets out principles which apply to credit brokers other than car dealer–credit brokers. So, when considering allegations of undisclosed payments of commission like the one in this complaint, Hopcraft, Johnson and Wrench is relevant law that I’m required to consider under Rule 3.6.4 of the Financial Conduct Authority’s Dispute Resolution Rules (‘DISP’). But I don’t think Hopcraft, Johnson and Wrench assists Mr and Mrs F in arguing that their credit relationship with the Lender was unfair to them for reasons relating to commission given the facts and circumstances of this complaint.

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I haven’t seen anything to suggest that the Lender and Supplier were tied to one another contractually or commercially in a way that wasn’t properly disclosed to Mr and Mrs F, nor have I seen anything that persuades me that the commission arrangement between them gave the Supplier a choice over the interest rate that led Mr and Mrs F into a credit agreement that cost disproportionately more than it otherwise could have. I acknowledge that it’s possible that the Lender and the Supplier 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 as I’ve said before, the case law on Section 140A makes it 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. And with that being the case, it isn’t necessary to make a formal finding on that because, even if the Lender and the Supplier failed to follow the relevant regulatory guidance at the Time of Sale, it is for the reasons set out below that I don’t think any such failure is itself a reason to find the credit relationship in question unfair to Mr and Mrs F. Based on what I’ve seen so far, the Supplier’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 the Supplier’s overall pursuit of a successful timeshare sale. I can’t see that the Supplier 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. And as it wasn’t acting as an agent of Mr and Mrs F 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 the Supplier had an obligation of ‘loyalty’ to them when arranging the Credit Agreement and thus a fiduciary duty. What’s more, in stark contrast to the facts of Mr Johnson’s case, as I understand it, the Lender didn’t pay the Supplier any commission at the Time of Sale. And with that being the case, even if there were information failings at that time and regulatory failings as a result (which I make no formal finding on), I’m not currently persuaded that the commission arrangements between the Supplier and the Lender were likely to have led to a sufficiently extreme inequality of knowledge that rendered the credit relationship unfair to Mr and Mrs F. Overall, therefore, I’m not persuaded that the commission arrangements between the Supplier and the Lender were likely to have led to a sufficiently extreme inequality of knowledge that rendered the credit relationship unfair to Mr and Mrs F. S140A conclusion Given all of the factors I’ve looked at in this part of my decision, and having taken all of them into account, I’m not persuaded that the credit relationship between Mr and Mrs F and the Lender under the Credit Agreement and related Purchase Agreement was unfair to them. So, I don’t think it is fair or reasonable that I uphold this complaint on that basis. Conclusion In conclusion, given the facts and circumstances of this complaint, I do not think that the Lender acted unfairly or unreasonably when it dealt with Mr and Mrs F’s section 75 claim, and I am not persuaded that the Lender was party to a credit relationship with them under the Credit Agreement that was unfair to them for the purposes of Section 140A of the CCA. And having taken everything into account, I see no other reason why it would be fair or reasonable to direct the Lender to compensate them.

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My final decision For the reasons set out above, I don’t uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mrs F and Mr F to accept or reject my decision before 27 April 2026. Jonathan Willis Ombudsman

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