Volkswagen Financial Services slapped with £5.4m FCA fine
Volkswagen Financial Services has been fined nearly £5.4m by the Financial Conduct Authority (FCA) for failing to treat vulnerable customers fairly.
The company has also agreed to pay more than £21.5m to around 110,000 customers who may have suffered as a result.
The FCA found that between 1 January 2017 and 31 July 2023, Volkswagen Financial Services failed to understand customers’ individual circumstances or to provide support tailored to their needs. This meant that, in some cases, Volkswagen Finance took cars away from vulnerable customers without considering other options.
It found that the poor treatment was compounded by poor templated and automated communications.
Volkswagen Financial Services fined
Therese Chambers, joint executive director of enforcement and market oversight, said:
“For many, a car is not a nice to have but a necessity for work or for family life. Volkswagen Finance made tough personal situations worse by failing to consider what those in difficulty might need. It is right it compensates those who suffered. This fine and redress should send clear signals to lenders that they need to properly support those in financial difficulty.”
The failings were uncovered during an FCA investigation into how lenders support borrowers in difficulty. Over the last four years it has secured more than £65m in redress for over 320,000 customers.
Volkswagen Financial Services will is now contacting affected customers with details of its redress scheme.
