Regulatory Round-up: September 2015

30 September 2015

Our experts provide their monthly bite size overviews of the major legal and regulatory developments and news for the consumer, asset and automotive finance sectors.

  1. Unfair terms: CMA publishes final guidance
  2. Update on FCA's finalised complaints handling rules
  3. GABRIEL reporting and new authorisation guides
  4. Ombudsman news article on vulnerability and FOS
  5. BIS launches review to improve anti-money laundering regime
  6. FCA cancels broker's permission after fee complaints
  7. Update on Google Inc v Vidal-Hall case
  8. Results of FCA thematic study into fair treatment of consumers who suffer unauthorised transactions

1. Unfair terms: CMA publishes final guidance

The Competition and Markets Agency (CMA) has produced a suite of documents to provide revised general guidance on unfair contract terms ahead of the upcoming changes that will be implemented by the Consumer Rights Act 2015 in October.

Differing levels of detail ranging from short, to intermediate to detailed guidance is available in separate documents, along with an appendix containing historic examples of unfair terms and another with a summary of the new elements contained in the upcoming act.

Look out for an alert from us offering guidance on this topic very soon.

2.Update on FCA's finalised complaints handling rules

We mentioned in our August round-up that the Financial Conduct Authority (FCA) had issued a Policy Statement comprising its finalised rules on complaint handling. Important new implications for firms filling out the GABRIEL complaints return next year have now come to light.

Firms reporting complaints data next August for the period January to June 2016 will need to use the new complaints form.

Although it will not be available on GABRIEL until February or March 2016, the new form requires new data to be collected, so changes to recording systems will need to be implemented before the reporting period begins i.e. by January 2016.

A copy of the new form is contained in the Policy Statement.

3. GABRIEL reporting and new authorisation guides

The FCA has announced that GABRIEL will be moving to a new location with effect from 21 September. The announcement can be found here and the new portal address here.

The FCA has also released 11 how-to guides to completing consumer credit applications on the Connect system. The videos can be found here.

4. Ombudsman news article on vulnerability and FOS

Following the FCA's Occasional Paper on the subject of vulnerability earlier in the year, the Financial Ombudsman Service (FOS) has published an article exploring the subject within the context of the complaints procedure, with 12 accompanying case studies.

The full edition of the Ombudsman News can be found here.

5. BIS launches review to improve Anti-Money Laundering regime

With the aim of making the Anti-Money Laundering and Terrorist Financing regime less burdensome and opaque, without weakening or undermining the current provisions, the government has announced a review process, guided by the experience of regulated businesses.

Details can be found here.

6. FCA cancels broker's permission after fee complaints

The FCA has declared that a loan broker was not fit and proper and has cancelled its interim permission.

The broker, Merlin Loans and Mortgages Limited, based in Bury, had taken a credit broking fee from customers without permission and then failed to comply with two awards made against it, despite pressure from both the FCA and FOS.

The FCA notice can be found here.

7. Update on Google Inc v Vidal-Hall case

The Supreme Court has granted permission for Google Inc to appeal against this landmark data protection case. The Court of Appeal upheld the High Court decision that the individual claimants could bring claims against Google Inc for the misuse of private information and breach of the Data Protection Act 1998.

The dispute relates to how Google used cookies to track and collect behavioural data revealing how individuals use the internet, without their knowledge or consent. This information was then sold to advertisers enabling targeted online advertising. The claimants do not allege that they suffered any material loss but claimed damages in the form of compensation for distress.

Google sought to appeal against this decision on three primary grounds, being whether the Court of Appeal was right to find that:

  1. misuse of private information is a tort;
  2. section 13(2) of the Data Protection Act, which requires victims to prove financial loss, is incompatible with the Data Protection Directive, which requires compensation for any damage; and
  3. section 13(2) must be disapplied because it conflicts with the rights to private and family life and to protection of personal data, as guaranteed by Article 7 and Article 8 of the EU Charter of Fundamental Rights.

The Supreme Court has given leave to Google Inc to appeal on grounds 2 and 3 so the upcoming decision will help to clarify the position on the extent and type of loss permitted when bringing a claim under data protection legislation.

8. Results of FCA thematic study into fair treatment of consumers who suffer unauthorised transactions

Following its investigation into the fair treatment of consumers who suffered unauthorised transactions (defined as a payment made from a customer's account without their consent), the FCA has found that firms are generally meeting their obligations to their consumers.

The full Thematic Review is available here, and includes a full review of the research and results, along with examples of good practice.


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