Discretionary Commission (Black Horse)

DannyC85

Hi all, I'm looking for advice on what to do with my current situation.
I sent off a complaint to Black Horse back in May/June 2023 regarding commission payments between them and the car dealer i had my car with, before any of this come to light in the media about the DCAs. They replied to me back then and said basically, no you didn't have any added to your loan, so i left it at that. It then came out about this on Martin Lewis, so i used their template and sent it over again as i thought maybe the wording would give me a better chance.

They've replied in letter form yesterday to say that i did have DCA on my hire purchase with them and that i need to wait until September 2024 for the FCA to finish their investigation. 

Why would they tell me i didn't have it and now tell me i have got it? Should i go back to them with my old complaint and ask them to settle early as its before November 2023, as stated on the website?

Cheers

Danny

DullGreyGuy

DCAs worked in both ways, a dealer could reduce the commission they received in exchange for lower interest rates. 

You've asked two different questions, it's possible the different answers related to the different wordings. Positive DCA would result in the answer DCA did apply to your contract but would also support the answer that you didnt have anything added to your loan.

Obviously the statement "it basically said" makes it much more conjecture then if you say what it actually said  

Nasqueron

DannyC85 said:

Hi all, I'm looking for advice on what to do with my current situation.
I sent off a complaint to Black Horse back in May/June 2023 regarding commission payments between them and the car dealer i had my car with, before any of this come to light in the media about the DCAs. They replied to me back then and said basically, no you didn't have any added to your loan, so i left it at that. It then came out about this on Martin Lewis, so i used their template and sent it over again as i thought maybe the wording would give me a better chance.

They've replied in letter form yesterday to say that i did have DCA on my hire purchase with them and that i need to wait until September 2024 for the FCA to finish their investigation. 

Why would they tell me i didn't have it and now tell me i have got it? Should i go back to them with my old complaint and ask them to settle early as its before November 2023, as stated on the website?

Cheers

Danny

It depends what was said on your letter, taking your post at face value:

You wrote to Black Horse about commission payments between them and the dealer.
They confirmed it was not added to your loan (i.e. they could have paid commission but you didn't pay for it)

That is the end of the debate since paying commission is perfectly fine and does not have to be disclosed, as such their letter is perfectly reasonable, they paid it to the dealer, it was not added to your loan.

You have subsequently asked them if the commission they paid (which again, they didn't have to tell you about) had a DCA element and they have confirmed it did so they will investigate.

Firstly, you can't ask them to settle anything because the FCA investigation is looking into whether having DCA was even a problem - if they say it isn't, then there is no issue.
Secondly, your initial question was about if they paid commission not if they paid DCA commission which could have changed the interest rate you got - that is a completely separate issue.

Commission is perfectly fine, you cannot complain about it
At the point of sale back then, DCA was not banned so there was nothing wrong in their sale
If the FCA says actually DCA was wrong and they should pay something back, then you would potentially get a pay-out, if they say it's fine, then you won't as again, commission per se is not a problem 

[Deleted User]

Lenders get stuff wrong all the time. Deliberate or genuine? You decide. The same thing happened to early adopters of PPI pre 2010. Many were told no PPI only later to be told there was, just it wasn’t on the account at the time. Due to system updates etc the screens that show commission in their data may well be blank or read £0 now, it is only with further, more manual checks that commission and the type can be ascertained. It is why I have previously said not to take a lender simply saying ‘no commission’ or ‘no DCA’ at face value. They should evidence it, if it’s just a screenshot of £0 this also is not enough imo. They won’t tell you this ofc, they just want you to accept the no and go away. Again, others on here will encourage you to do the same thing, I would encourage you to satisfy your query to your own levels of certainty and to always consider that they get things wrong. A lot. It is far too common that the actual truth doesn’t come out in cases of all sorts I have been involved with over the years until a part 18 request (litigation not complaints). An embarrassed, grovelling ‘whoopsie’ to the court usually follows. More like a ‘gotcha’…

Barkermn01

Nasqueron said:

That is the end of the debate since paying commission is perfectly fine and does not have to be disclosed, as such their letter is perfectly reasonable, they paid it to the dealer, it was not added to your loan.

This is not quite the case lookup "DRN-4188284 financial-ombudsman"

The broker's failure to disclose the discretionary commission structure, as mandated by regulatory guidelines (specifically, CONC 4.5.3R, CONC 3.7.4G(2), and Principles 7 and 8), is deemed under s. 56(2) CCA to be a failure by Black Horse. As such, they are required to disclose the commission in cases where it affects the contract, particularly "determining the interest rate," which is one of the three main components of a contract. Therefore, the assertion "does not have to be disclosed" is incorrect; the Financial Conduct Ombudsman has determined that disclosure is necessary under certain circumstances according to the law.

DullGreyGuy

Barkermn01 said:
the Financial Conduct Ombudsman 

Do you mean the Financial Conduct Authority - the regulator of financial services from a conduct perspective (vs the PRA that regulates from a financial stability perspective) or the Financial Ombudsman Service - the ombudsman empowered by the FCA to act as an alternative dispute resolution service for customer complaints against financial services company and to find a "fair" outcome?

Barkermn01

No i meant the Financial Conduct Authority & Ombudsman.