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Vulnerable people who owned cars through a loan scheme with Volkswagen’s finance arm had them taken away with “limited, if any” warning, a watchdog has ruled.<\/p>\n
One customer who was struggling to meet loan payments told Volkswagen Finance he was going through a difficult time and had tried to take his own life, but the firm showed “a lack of empathy”, the Financial Conduct Authority (FCA) said.<\/p>\n
Around 110,000 customers will get a share of the \u00a321.5m compensation the FCA said VW Finance must pay for its failures.<\/p>\n
The FCA has also fined the firm \u00a35.4m for the behaviour. The company said it had made “significant adjustments” to its business since.<\/p>\n<\/div>\n
VW Finance added it recognised its shortcomings and apologised for “any detriment caused”.<\/p>\n
According to the FCA’s report<\/a>, VW Finance failed to engage with customers who were struggling to pay and sent them “templated communications”.<\/p>\n Other drivers were charged the cost of taking their cars away and ignored by VW Finance when they tried to discuss repayment options.<\/p>\n The FCA’s report was the result of speaking to case studies and analysing VW Finance’s processes.<\/p>\n The report cites one man who told the company about his divorce, anxiety and attempts to take his own life, but was treated “sarcastically”.<\/p>\n It also refers to a woman who lost her job and had her car taken away and sold at auction after falling behind on the payments, despite offering multiple times to find a repayment arrangement.<\/p>\n After the car was repossessed, she was charged \u00a3252 for “sundry debit\u201d and an \u201cadjustment\u201d.<\/p>\n “In actual fact, this was a repossession fee,” the FCA said.<\/p>\n VW Finance would have been fined \u00a37.7m, but it received a 30% discount after agreeing with the FCA to solve the issues.<\/p>\n “We recognise our shortcomings in these past cases and have made significant adjustments over recent years to ensure that we are always delivering the right level of service,” a spokesperson for VW Finance told the BBC.<\/p>\n “We are in the process of concluding our remediation efforts as we continue to provide goodwill payments to affected customers and apologise for any detriment caused.”<\/p>\n VW Finance is the UK-based finance arm of the wider German car group Volkswagen, which also owns car brands Audi, Skoda, Bentley, Porsche and several others.<\/p>\n This not the only time the FCA has punished a car finance firm for its treatment of vulnerable customers.<\/p>\n