Thread: Broker/Lender who mis-sold ppi????????

Hello,

I was wondering if anybody could assist on this matter, I have posted this on behalf of a few caggers, who are asking who would responsible for the mis-selling of PPI, in the case of taking a loan via a broker.

Both of the brokers and the lender are denying and blaming each other
I have found this please of information regarding responsiblity when it is commission based.

Can anybody give any guidence on this

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Decision in Hurstanger v Wilson
[2007] EWCA Civ 299
This is may be of relevance to all members who pay fees to brokers.
Case Summary
The borrowers (Mr Wilson and Ms Burton) obtained a loan through a
broker. The broker had a fiduciary relationship with the borrowers and
received commission from the lender.
At issue was whether the broker had received secret commission from the
lender and whether informed consent had been given by the borrowers.
The borrowers signed a form which indicated that commission might be
paid but they argued that informed consent had not been given because
they did not know the amount of the commission.
It was held that the broker may only receive commission if the borrower
consented to this with full knowledge of all material circumstances. The
Court of Appeal held that the commission, in this case, was not “secret”
but informed consent had not been given as the amount of commission
had not been disclosed. (Accordingly they awarded the amount of the
commission plus 1.29% simple interest from the date of the agreement’s
inception).
The Court also held that in cases where the broker does not disclose
that she is in receipt of commission from the lender, the commission will be
“secret”, the broker potentially guilty of fraud, and the entire loan liable to
be rescinded.
Implications
The legal teams of all members who pay commission to brokers should
consider the impact of the decision on their business.
__________________

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Hello Shane,

Thanks for your response. the problem is they do mis-sell time and time again and they will say it is not them, the original lender states that it is not them and around and round the poor customer goes.

I did post up a court case as precedent in my first post, do you think that this case would hold in court in commission based selling

There does appear that many customers took loans through brokers and are struggling to get anywhere with these claims, especially if they are out of the fos remit.

Thanks in advance