FCA to look into Sale or Return

[craigjm]

Just seen this come up on one of my news feeds.....

https://cardealermagazine.co.uk/fca-launches-sale-...

[alscar]

Horse as usual is a couple of fields away - SOR “ issues “ are nothing new and there has always been concerns over using which is why your own due diligence / personal recs should always have been a factor.
That said their review won’t prove exactly that complicated to “ pass “ no doubt.

[Trevor555]

SOR is an owner simply giving their car to a dealer, and trusting that dealer to pay them when it's sold.

There's nothing wrong with that model if the dealer is trustworthy.

What's the FCA going to do?

[ADJimbo]

I will be interested to see how this plays-out in the real world.

Retention of title can be proved when an Administrator comes into the mix - inconvenient yes, but not insurmountable for the consumer to recover their asset.

I’d be interested to read their proposal(s) for when title passes, funds are received, and the original owner then becomes an unsecured creditor.

Edited by ADJimbo on Thursday 9th April 12:31

[samoht]

Underlying lawyer blog post https://www.lawgistics.co.uk/blog/legal_updates/fc...

John McDougall said:

The FCA is looking at three particular areas:
* Risk management processes
* Consumer understanding and communication
* Policies, procedures and oversight

On (2) I think many SoR sellers would respond differently if you asked them "would you like to make an unsecured loan of £100k+ to this random small business with zero security?".

On (3) I guess one question is what stops the dealer lying about when the car sold or how much it sold for, are there processes to catch this?

ADJimbo said:

I d be interested to read their proposal(s) for when title passes, funds are received, and the original owner then becomes an unsecured creditor.

Yes probably the toughest issue. The obvious answer would be that the buyer's payment is paid into escrow and disbursed accordingly.