Timeshare Mis-selling - the Next Financial Scandal?
LONDON, UK / ACCESSWIRE / January 17, 2019 / Malaga based law firm Maxima 1 Legal S.L. (M1 Legal) can now confirm they are regulated by the Claims Management Regulator in respect of regulated claims.
This means that they can now take legal action on behalf of consumers against financial institutions such as banks and credit card companies for misrepresentation and unregulated lending.
This will be another side to their business which will be given a strong focus over the coming months under the branding of Bank Reclaims. The brand will not solely focus on timeshare, they will also offer no win no fee claims against other mis-sold loans.
M1 legal lawyer Adriana Stoyanova commented: ″When the UK Financial Conduct Authority (FCA) took over responsibility for regulating consumer credit from the Office of Fair Trading (OFT) on 1st April, 2014, it promised to tougher measures aiming to protect consumers and restore public confidence in the sector.
″It seems, however, that before that date and during the transition period some companies involved in the sector still did not comply with the legal requirements imposed under the applicable legislation.
″An example which recently disclosed such infringements is the case of the timeshare resort Azure Island Residence Club, located in Malta, which mis-sold timeshare products to many British citizens, financed by Barclays Partner Finance,″ she added.
″It appeared that during the period 1st April, 2014 - 24th, April 2016 British consumers signed 1,444 loan agreements which financed their timeshare purchases through the credit intermediary Azure Services Limited, which was not authorised by the FCA to carry on this regulated activity, i.e. credit brokering.
″The FCA issued a validation order; however, we appealed the validation order, on behalf of 25 affected people, in front of the Upper Tribunal. The judge found that there was evidence of potential consumer detriment - a relevant factor to be taken into account in deciding whether it is just and equitable to make a validation order (which was a precedent).
″In this particular case, the evidence of potential consumer detriment was considered being that the consumers were misrepresented about the duration and the loan conditions. For that reason, the Upper Tribunal decided to remit the matter back to the FCA to reconsider its decision, with a direction to take into account Consumer Detriment, without placing any further limitation on the scope of what the FCA should consider.″
Link to the decision of the Upper Tribunal:
In their representations, BPF stated that the total amount payable under the relevant 1,444 loans is around £47million.
″Considering the fact that this is a small timeshare resort in Malta, we could imagine what the amount would be for some of the European timeshare resorts, which have thousands of members. This could be the next financial scandal!″ said Adriana Stoyanova.
An audit was also carried out on all M1 legal files. It revealed that around 40% of the files which have loan agreements were arranged by unregulated finance brokers with loan amounts totalling just under £6million.
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SOURCE: M1 Legal