Clydesdale Financial Services Limited · DRN-6257500

The complaint Mr M’s complaint is, in essence, that Clydesdale Financial Services Limited trading as Barclays Partner Finance (the ‘Lender’) acted unfairly and unreasonably by being party to an unfair credit relationship with her under Section 140A of the Consumer Credit Act 1974 (as amended) (the ‘CCA’). What happened Mr M was the member of a timeshare provider (the ‘Supplier’) – having purchased a previous product from it in 2017. But the product at the centre of this complaint is his membership of a timeshare that I’ll call the ‘Fractional Club’ – which he and Ms M bought on 11 June 2018 (the ‘Time of Sale’). They entered into an agreement with the Supplier to buy 1820 fractional points at a cost of £13,729 (the ‘Purchase Agreement’). Fractional Club membership was asset backed – which meant it gave Mr M and Ms M more than just holiday rights. It also included a share in the net sale proceeds of a property named on the Purchase Agreement (the ‘Allocated Property’) after their membership term ends. Fractional Club membership was paid for by Mr M taking finance of £13,729 from the Lender (the ‘Credit Agreement’). Mr M – using a professional representative – (the ‘PR’) – wrote to the Lender on 20 July 2022 (the ‘Letter of Complaint’) to raise a number of different concerns. As those concerns haven’t changed since they were first raised, and as both sides are familiar with them, it isn’t necessary to repeat them in detail here beyond the summary above. The Lender didn’t provide its final response within the usual timescales so Mr M referred his complaint to the Financial Ombudsman Service. It was assessed by an Investigator who, having considered the information on file, said that there wasn’t a valid claim for misrepresentation under Section 75 of the CCA because the cash value of Fractional Club membership meant it didn’t come within that provision. He rejected the rest of the complaint on its merits. Mr M disagreed with the Investigator’s assessment and asked for an Ombudsman’s decision and it was passed to me. I considered the matter and issued a provisional decision (‘PD’) dated 17 February 2026 explaining why I didn’t think the complaint should be upheld. The findings from my PD are set out below. “I have considered all the available evidence and arguments to decide what is fair and reasonable in the circumstances of this complaint. And having done that, I do not currently think this complaint should be upheld. However, before I explain why, I want to make it clear that my role as an Ombudsman is not to address every single point that has been made to date. Instead, it is to decide what is fair and reasonable in the circumstances of this complaint. So, if I have not commented on, or referred to, something that either party has said, that does not mean I have not considered it.

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Section 75 of the CCA: the Supplier’s misrepresentations at the Time of Sale The CCA introduced a regime of connected lender liability under section 75 that affords consumers (“debtors”) a right of recourse against lenders that provide the finance for the acquisition of goods or services from third-party merchants (“suppliers”) in the event that there is an actionable misrepresentation and/or breach of contract by the supplier. Certain conditions must be met if the protection afforded to consumers under Section 75(1) is engaged. Section 75(3) of the CCA says that: “Subsection (1) does not apply to a claim ………..(b) so far as the claim relates to any single item to which the supplier has attached a cash price not exceeding £100 or more than £30,000…” Although Mr M only paid £13,279 for Fractional Club membership the cash price was actually £30,130 with Mr M being given credit of £16,900 for trading in the previous purchase he had made. In the circumstances there isn’t a valid claim under Section 75 although the misrepresentations that have been alleged could still be relevant when considering the complaint about there being an unfair credit relationship under Section 140A of the CCA. Section 140A of the CCA: did the Lender participate in an unfair credit relationship? Having considered the entirety of the credit relationship between Mr M and the Lender along with all of the circumstances of the complaint, I don’t think the credit relationship between them was likely to have been rendered unfair for the purposes of Section 140A. When coming to that conclusion, and in carrying out my analysis, I have looked at: 1. The standard of the Supplier’s commercial conduct – which includes its sales and marketing practices at the Time of Sale along with any relevant training material; 2. The provision of information by the Supplier at the Time of Sale, including the contractual documentation and disclaimers made by the Supplier; 3. Evidence provided by both parties on what was likely to have been said and/or done at the Time of Sale; 4. The commission arrangements between the Lender and the Supplier at the Time of Sale and the disclosure of those arrangements; 5. The inherent probabilities of the sale given its circumstances. I have then considered the impact of these on the fairness of the credit relationship between Mr M and the Lender. The Supplier’s sales & marketing practices at the Time of Sale Mr M’s complaint about the Lender being party to an unfair credit relationship was made for several reasons. I have firstly considered the alleged misrepresentations and whether these provide evidence that the Lender participated in an unfair credit relationship. It was said in the Letter of Complaint that Fractional Club membership had been misrepresented by the Supplier at the Times of Sale because Mr M and Ms M were: 1. Told that they had purchased an investment that would “considerably appreciate in value”. 2. Promised a considerable return on their investment because they were told that they would own a share in a property that would considerably increase in value. 3. Told that they could sell their Fractional Club membership to the Supplier or easily to

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third parties at a profit. 4. Made to believe that they would have access to “the holiday apartment” at any time all year round. However, neither points 1 nor 2 strike me as misrepresentations even if such representations had been made by the Supplier (which I make no formal finding on). Telling prospective members that they were investing their money because they were buying a fraction or share of one of the Supplier’s properties was not untrue. And even if the Supplier’s sales representatives went further and suggested that the share in question would increase in value, perhaps considerably so, that sounds like nothing more than a honestly held opinion as there isn’t any accompanying evidence to persuade me that the relevant sales representative(s) said something that, while an opinion, amounted to a statement of fact that they did not hold or could not have reasonably held. As for points 3 and 4, while it’s possible that Fractional Club membership was misrepresented at the Time of Sale for one or both of those reasons, I don’t think it’s probable. They’re given little to none of the colour or context necessary to demonstrating that the Supplier made false statements of existing fact and/or opinion. And as there isn’t any other evidence on file to support the suggestion that Fractional Club membership was misrepresented for these reasons, I don’t think it was. So, while I recognise that Mr M and the PR have concerns about the way in which Fractional Club membership was sold by the Supplier, I can only consider whether there was a factual and material misrepresentation by the Supplier. For the reasons I’ve set out above, I’m not persuaded that there was. However, there are other aspects of the sales process that, being the subject of dissatisfaction, I must explore with Section 140A in mind if I’m to consider this complaint in full – which is what I’ve done next. The PR says, for instance, that the right checks weren’t carried out before the Lender lent to Mr M. I haven’t seen anything to persuade me that was the case in this complaint given its circumstances. But even if I were to find that the Lender failed to do everything it should have when it agreed to lend (and I make no such finding), I would have to be satisfied that the money lent to Mr M was actually unaffordable before also concluding that he lost out as a result and then consider whether the credit relationship with the Lender was unfair to him for this reason. But from the information provided, I am not satisfied that the lending was unaffordable to Mr M. Connected to this is the suggestion by the PR that the Credit Agreement was arranged by an unauthorised credit broker, the upshot of which is to suggest that the Lender wasn’t permitted to enforce the Credit Agreement. However, it looks to me like Mr M knew, amongst other things, how much he was borrowing and repaying each month, who he borrowing from and that he was borrowing money to pay for Fractional Club membership. And as the lending doesn’t look like it was unaffordable for him, even if the Credit Agreement was arranged by a broker that didn’t have the necessary permission to do so (which I make no formal finding on), I can’t see why that led to Mr M suffering a financial loss – such that I can say that the credit relationship in question was unfair on him as a result. And with that being the case, I’m not persuaded that it would be fair or reasonable to tell the Lender to compensate him, even if the loan wasn’t arranged properly. The PR also says that there was one or more unfair contract terms in the Purchase Agreement. But as I can’t see that any such terms were operated unfairly against Mrs M and Ms M in practice, nor that any such terms led them to behave in a certain way to their detriment, I’m not persuaded that any of the terms governing Fractional Club membership

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are likely to have led to an unfairness that warrants a remedy. Overall, therefore, I don’t think that Mr M’s credit relationship with the Lender was rendered unfair to him under Section 140A for any of the reasons set out above and referred to in the Letter of Complaint. But there is another reason, perhaps the main reason, why the PR says the credit relationship with the Lender was unfair to him. And that’s the suggestion that Fractional Club membership was marketed and sold to him and Ms M as an investment in breach of the prohibition against selling timeshares in that way. The Supplier’s alleged breach of Regulation 14(3) of the Timeshare Regulations The Lender does not dispute, and I am satisfied, that Mr M’s and Ms M’s Fractional Club membership met the definition of a “timeshare contract” and was a “regulated contract” for the purposes of the Timeshare Regulations. Regulation 14(3) of the Timeshare Regulations prohibited the Supplier from marketing or selling Fractional Club membership as an investment. This is what the provision said at the Time of Sale: “A trader must not market or sell a proposed timeshare contract or long-term holiday product contract as an investment if the proposed contract would be a regulated contract.” But the PR says that the Supplier did exactly that at the Time of Sale – saying, in summary, that Mr M and Ms M were told by the Supplier that Fractional Club membership was the type of investment that would only increase in value. The term “investment” is not defined in the Timeshare Regulations. But for the purposes of this provisional decision, and by reference to the decided authorities, an investment is a transaction in which money or other property is laid out in the expectation or hope of financial gain or profit. A share in the Allocated Property clearly constituted an investment as it offered Mr M and Ms M the prospect of a financial return – whether or not, like all investments, that was more than what they first put into it. But it is important to note at this stage that the fact that Fractional Club membership included an investment element did not, itself, transgress the prohibition in Regulation 14(3). That provision prohibits the marketing and selling of a timeshare contract as an investment. It doesn’t prohibit the mere existence of an investment element in a timeshare contract or prohibit the marketing and selling of such a timeshare contract per se. In other words, the Timeshare Regulations did not ban products such as the Fractional Club. They just regulated how such products were marketed and sold. To conclude, therefore, that Fractional Club membership was marketed or sold to Mr M and Ms M as an investment in breach of Regulation 14(3), I have to be persuaded that it was more likely than not that the Supplier marketed and/or sold membership to them as an investment, i.e. told them or led them to believe that Fractional Club membership offered them the prospect of a financial gain (i.e., a profit) given the facts and circumstances of this complaint. There is competing evidence in this complaint as to whether Fractional Club membership was marketed and/or sold by the Supplier at the Time of Sale as an investment in breach of regulation 14(3) of the Timeshare Regulations. On the one hand, it is clear that the Supplier made efforts to avoid specifically describing membership of the Fractional Club as an ‘investment’ or quantifying to prospective purchasers, such as Mr M and Ms M, the financial value of their share in the net sales proceeds of the Allocated Property along with the investment considerations, risks and

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rewards attached to them. On the other hand, I acknowledge that the Supplier’s sales process left open the possibility that the sales representative may have positioned Fractional Club membership as an investment. So, I accept that it’s equally possible that Fractional Club membership was marketed and sold to Mr M and Ms M as an investment in breach of Regulation 14(3) as they have alleged. However, whether, or not, there was a breach of the relevant prohibition by the Supplier is not ultimately determinative of the outcome in this complaint for reasons I go into below. And with that being the case, it’s not necessary to make a formal finding on that particular issue for the purposes of this decision. Would the credit relationship between the Lender and Mr M and Ms M have been rendered unfair to them had there been a breach of Regulation 14(3) of the Timeshare Regulations? Having found that it was possible that the Supplier breached Regulation 14(3) of the Timeshare Regulations at the Time of Sale, I now need to consider what impact that breach had on the fairness of the credit relationship between Mr M and the Lender under the Credit Agreement and related Purchase Agreement as the case law on Section 140A makes it clear that regulatory breaches do not automatically create unfairness for the purposes of that provision. Such breaches and their consequences (if there are any) must be considered in the round, rather than in a narrow or technical way. Indeed, it seems to me that, if I am to conclude that a breach of Regulation 14(3) led to a credit relationship between Mr M and the Lender that was unfair to him and warranted relief as a result, whether the Supplier’s breach of Regulation 14(3) led him to enter into the Purchase Agreement and the Credit Agreement is an important consideration. In an email dated 22 July 2024 the PR provided an unsigned and undated statement from Mr M and Ms M which they stated was dated 9 February 2022. I can’t see why the statement is neither signed nor dated and there is nothing to show it was created when the PR has said. However, if I accept it was provided by Mr M and Ms M in 2022 as the PR says it doesn’t provide any persuasive evidence that they wouldn’t have gone ahead with purchasing Fractional Club membership regardless of whether, or not, of its investment element. The statement is detailed, amounting to nearly four pages and addresses three purchases. The initial purchase of fractional points in 2017, the 2018 purchase of fractional points the subject of this complaint, and then a subsequent purchase of points in another timeshare product in November 2019. However, this complaint is only about the 2018 purchase. This is what Mr M said about the 2018 sale: “As we wanted to take advantage of the more luxurious accommodation within the California Suites, she explained that our then points allocation, would probably only give us one week of accommodation on an annual basis. At that stage we had 1300 points and one week stay at San Diego being 1220 to 1580 points or Santa Cruz being 1280 to 1660 points. Whilst we had an initial allocation of 500 bonus points, this meant that the following year, we would struggle to have a two week holiday let alone the 3-4 weeks we were hoping for in addition to any possible UK breaks. Due to Ken’s mobility issues, Mina advised that we would be better to consider having a greater points allocation. She went to discuss our situation with her manager and brought him back to see us. He suggested that he was willing to consider offering a ‘trade-in’ for our existing fractional share. They offered a ‘Signature Suite’ which was under refurbishment so would not be available until 2019. However, we would then also be able to trade in the week’s accommodation for 1820 points for 100 euros. Signature Membership would also enable us to access 2 for 1 offers and three upgrades onwards with

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effect from 1 January 2019.” There is nothing in what Mr M and Ms M have said that suggests they purchased Fractional Club membership in 2018 because it was an investment. To the contrary, what they say to my mind makes it very clear that they decided to purchase membership for other reasons, such as this providing more points for holidaying and other benefits such as 2 for 1 offers. The PR provided further evidence from Mr M and Mrs M following receipt of the Investigator’s opinion. This was by way of an email from Mr M and Ms M dated 14 August 2024. In that email they repeat some of the evidence provided in their earlier testimony – for example saying that they were persuaded to change their membership to take advantage of more luxurious accommodation and 2 for 1 offers. However, whereas in the original testimony they say nothing about purchasing Fractional Club membership in 2018 because of the return they might make when membership ended, in the email they go on to say: “We were also persuaded that this was an improved investment and would lead to better returns in the future at the end of our membership.” I don’t find what they have said about this credible in the circumstances. If this was a motivating reason for their purchase in 2018 I can see no reason it wouldn’t have been included in the detailed testimony the PR says they provided in February 2022. In the circumstances I can place no weight on what they have said about this. Moreover, the suggestion they have made that they purchased Fractional Club membership in 2018 because it was an investment is in any event contradicted by the fact that in November 2019 they traded in their Fractional Club membership for Holiday Owners Club membership. This wasn’t asset backed and they were therefore not entitled to a share of the net sale proceeds of a property when membership ended. If Mr M and Ms M had purchased Fractional Club membership because of the gain or profit they might make at the end of their membership, trading in that membership less than 18 months later for a membership that provided no prospect of any gain makes no sense at all. As Mr M and Ms M themselves don’t persuade me that their purchase was motivated by their share in the Allocated Property and the possibility of a profit, I don’t think a breach of Regulation 14(3) by the Supplier was likely to have been material to the decision they ultimately made. On balance, therefore, even if the Supplier had marketed or sold the Fractional Club membership as an investment in breach of Regulation 14(3) of the Timeshare Regulations, I am not persuaded that Mr M’s and Ms M’s decision to purchase Fractional Club membership at the Time of Sale was motivated by the prospect of a financial gain (i.e., a profit). On the contrary, I think the evidence suggests they would have pressed ahead with their purchase whether, or not, there had been a breach of Regulation 14(3). And for that reason, I do not think the credit relationship between Mr M and the Lender was unfair to him even if the Supplier had breached Regulation 14(3). I concluded that, given the facts and circumstances of this complaint, there wasn’t a valid claim under Section 75 and I wasn’t persuaded that the Lender was party to a credit relationship with Mr M under the Credit Agreement that was unfair to him for the purposes of Section 140A of the CCA. And having taken everything into account, I could see no other reason why it would be fair or reasonable to direct the Lender to compensate him. I gave both parties the opportunity of responding and providing any further information they wanted me to consider before making my final decision. The Lender responded and agreed with the PD. The PR also responded but didn’t agree with the PD and provided some further

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information they wish to be considered. Having received the relevant responses from both parties, I’m now finalising my decision. The legal and regulatory context In considering what is fair and reasonable in all the circumstances of the complaint, I am required under DISP 3.6.4R to take into account: relevant (i) law and regulations; (ii) regulators’ rules, guidance and standards; and (iii) codes of practice; and (where appropriate), what I consider to have been good industry practice at the relevant time. The legal and regulatory context that I think is relevant to this complaint is, in many ways. no different to that shared in several hundred published ombudsman decisions on very similar complaints – which can be found on the Financial Ombudsman Service’s website. And with that being the case, it is not necessary to set out that context in detail here. But I would add that the following regulatory rules/guidance are also relevant: The Consumer Credit Sourcebook (‘CONC’) – Found in the Financial Conduct Authority’s (the ‘FCA’) Handbook of Rules and Guidance Below are the most relevant provisions and/or guidance as they were at the relevant time: • CONC 3.7.3 [R] • CONC 4.5.3 [R] • CONC 4.5.2 [G] The FCA’s Principles The rules on consumer credit sit alongside the wider obligations of firms, such as the Principles for Businesses (‘PRIN’). Set out below are those that are most relevant to this complaint: • Principle 6 • Principle 7 • Principle 8 What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Following the responses from both parties, I’ve considered the case afresh and having done so, I’ve reached the same decision as that which I outlined in my provisional findings, for broadly the same reasons. The PR has provided no new information or evidence that would lead me to change the findings I made, which for the avoidance of doubt form part of the findings in this final decision unless I state to the contrary. Again, my role as an Ombudsman isn’t to address every single point which has been made to date, but to decide what is fair and reasonable in the circumstances of this complaint. If I haven’t commented on, or referred to, something that either party has said, this doesn’t mean I haven’t considered it. Rather, I’ve focused here on addressing what I consider to be the key issues in deciding this complaint and explaining the reasons for reaching my final decision.

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The PR’s further comments in response to the PD in the main relate to the issue of whether the credit relationship between Mr Mand the Lender was unfair. In particular, the PR has provided further comments in relation to whether the membership was sold to him and Ms M as an investment at the Time of Sale. They’ve also now argued for the first time that the commission arrangements between the Supplier and Lender rendered the credit relationship between Mr M and the Lender unfair. As outlined in my PD, the PR originally raised various other points of complaint, all of which I addressed at that time. But they didn’t make any further comments in relation to those in their response to my PD. Indeed, they haven’t said they disagree with any of my provisional conclusions in relation to those other points. And since I haven’t been provided with anything more in relation to those other points by either party, I see no reason to change my conclusions in relation to them as set out in my PD. So, I’ll focus here on the PR’s points raised in response. Section 140A of the CCA: did the Lender participate in an unfair credit relationship? The Supplier’s alleged breach of Regulation 14(3) of the Timeshare regulations I explained in the PD why I didn’t find the testimony of Mr M and Ms M persuasive as to them purchasing Fractional Club membership because it was an investment, finding they purchased for other reasons such as it providing more points for holidays and 2 for 1 offers. The PR disagrees with my findings on this and argues that the fact Mr M and Ms M were interested in holidays doesn’t change the fact the prospect of a profit also influenced their decision and that they clearly stated the benefits that convinced them to purchase which included the potential gain made from selling the Allocated Property at the end. But the PR has provided no new evidence and has simply relied on the testimony already considered by me before issuing my PD. I explained why this evidence didn’t persuade me they purchased Fractional Club membership because it was an investment and in the absence of any new evidence I can see no reason to change my findings on this. The PR also said that in the judgment handed down in Shawbrook & BPF v FOS, it was not challenged that the product in question was marketed and sold as an investment. But, as I explained in my provisional decision, the Timeshare Regulations did not ban products such as the Fractional Club. They just regulated how such products were marketed and sold. And the judgment referred to did not make a blanket finding that all such products were mis-sold in the way the PR appears to be suggesting. Any complaint needs to be considered in the light of its specific circumstances. So, as I said before, even if the Supplier had marketed or sold the membership as an investment in breach of Regulation 14(3) (which I still make no finding on here), I’m not persuaded Mr M’s and Mrs M’s decision to make the purchase was motivated by the prospect of a financial gain. So, I still don’t think the credit relationship between Mr M and the Lender was unfair to him for this reason. The provision of information by the Supplier at the Time of Sale In response to the PD the PR raised a new argument, namely that a payment of commission from the Lender to the Supplier at the Time of Sale should lead me to uphold this complaint because, simply put, information in relation to that payment went undisclosed at the Time of Sale. I explained in my PD that in deciding whether there was an unfair credit relationship one of the things I had considered was the commission arrangements between the Lender and the

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Supplier at the Time of Sale and the disclosure of those arrangements. I set out below in more detail why I am not satisfied that the commission arrangements between the Lender and Supplier did lead to an unfair credit relationship between Mr M and the Lender. As both sides already know, the Supreme Court handed down an important judgment on 1 August 2025 in a series of cases concerned with the issue of commission: Johnson v FirstRand Bank Ltd, Wrench v FirstRand Bank Ltd and Hopcraft v Close Brothers Ltd [2025] UKSC 33 (‘Hopcraft, Johnson and Wrench’). The Supreme Court ruled that, in each of the three cases, the commission payments made to car dealers by lenders were legal, as claims for the tort of bribery, or the dishonest assistance of a breach of fiduciary duty, had to be predicated on the car dealer owing a fiduciary duty to the consumer, which the car dealers did not owe. A “disinterested duty”, as described in Wood v Commercial First Business Ltd & ors and Business Mortgage Finance 4 plc v Pengelly [2021] EWCA Civ 471, is not enough. However, the Supreme Court held that the credit relationship between the lender and Mr Johnson was unfair under Section 140A of the CCA because of the commission paid by the lender to the car dealer. The main reasons for coming to that conclusion included, amongst other things, the following factors: 1. The size of the commission (as a percentage of the total charge for credit). In Mr Johnson’s case it was 55%. This was “so high” and “a powerful indication that the relationship…was unfair” (see paragraph 327); 2. The failure to disclose the commission; and 3. The concealment of the commercial tie between the car dealer and the lender. The Supreme Court also confirmed that the following factors, in what was a non-exhaustive list, will normally be relevant when assessing whether a credit relationship was/is unfair under Section 140A of the CCA: 1. The size of the commission as a proportion of the charge for credit; 2. The way in which commission is calculated (a discretionary commission arrangement, for example, may lead to higher interest rates); 3. The characteristics of the consumer; 4. The extent of any disclosure and the manner of that disclosure (which, insofar as Section 56 of the CCA is engaged, includes any disclosure by a supplier when acting as a broker); and 5. Compliance with the regulatory rules. From my reading of the Supreme Court’s judgment in Hopcraft, Johnson and Wrench, it sets out principles which apply to credit brokers other than car dealer–credit brokers. So, when considering allegations of undisclosed payments of commission like the one in this complaint, Hopcraft, Johnson and Wrench is relevant law that I’m required to consider under Rule 3.6.4 of the Financial Conduct Authority’s Dispute Resolution Rules (‘DISP’). But I don’t think Hopcraft, Johnson and Wrench assists Mr M in arguing that his credit relationship with the Lender was unfair to him for reasons relating to commission given the facts and circumstances of this complaint. I haven’t seen anything to suggest that the Lender and Supplier were tied to one another contractually or commercially in a way that wasn’t properly disclosed to Mr M nor have I seen anything that persuades me that the commission arrangement between them gave the Supplier a choice over the interest rate that led Mr M Into a credit agreement that cost disproportionately more than it otherwise could have.

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I acknowledge that it’s possible that the Lender and the Supplier failed to follow the regulatory guidance in place at the Time of Sale insofar as it was relevant to disclosing the commission arrangements between them. But as I’ve said before, the case law on Section 140A makes it clear that regulatory breaches do not automatically create unfairness for the purposes of that provision. Such breaches and their consequences (if there are any) must be considered in the round, rather than in a narrow or technical way. And with that being the case, it isn’t necessary to make a formal finding on that because, even if the Lender and the Supplier failed to follow the relevant regulatory guidance at the Time of Sale, it is for the reasons set out below that I don’t currently think any such failure is itself a reason to find the credit relationship in question unfair to Mr M. In stark contrast to the facts of Mr Johnson’s case, the amount of commission paid by the Lender to the Supplier for arranging the Credit Agreement that Mr M entered into wasn’t high. At £343.23 it was only 2.5% of the amount borrowed and even less than that as a proportion of the charge for credit. So, had he known at the Time of Sale that the Supplier was going to be paid a flat rate of commission at that level, I’m not currently persuaded that he either wouldn’t have understood that or would have otherwise questioned the size of the payment at that time. After all, Mr M wanted Fractional Club membership and had no obvious means of his own to pay for it. And at such a low level, the impact of commission on the cost of the credit he needed for a timeshare he and Ms M wanted doesn’t strike me as disproportionate. So, I think he would still have taken out the loan to fund their purchase at the Time of Sale had the amount of commission been disclosed. What’s more, based on what I’ve seen so far, the Supplier’s role as a credit broker wasn’t a separate service and distinct from its role as the seller of timeshares. It was simply a means to an end in the Supplier’s overall pursuit of a successful timeshare sale. I can’t see that the Supplier gave an undertaking – either expressly or impliedly – to put to one side its commercial interests in pursuit of that goal when arranging the Credit Agreement. And as it wasn’t acting as an agent of Mr M and Ms M but as the supplier of contractual rights they obtained under the Purchase Agreement, the transaction doesn’t strike me as one with features that suggest the Supplier had an obligation of ‘loyalty’ to Mr M when arranging the Credit Agreement and thus a fiduciary duty. Overall, therefore, I’m not persuaded that the commission arrangements between the Supplier and the Lender were likely to have led to a sufficiently extreme inequality of knowledge that rendered the credit relationship unfair to Mr M. Section 140A: Conclusion Given all of the factors I’ve looked at in this part of my decision, and having taken all of them into account, I’m not persuaded that the credit relationship between Mr M and the Lender under the Credit Agreement and related Purchase Agreement was unfair to him. So, I don’t think it is fair or reasonable that I uphold this complaint on that basis Commission: The Alternative Grounds of Complaint While I’ve found that Mr M’s credit relationship with the Lender wasn’t unfair to him for reasons relating to the commission arrangements between it and the Supplier, two of the grounds on which I came to that conclusion also constitute separate and freestanding complaints to Mr M’s complaint about an unfair credit relationship. So, for completeness, I’ve considered those grounds on that basis here. The first ground relates to whether the Lender is liable for the dishonest assistance of a

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breach of fiduciary duty by the Supplier because it took a payment of commission from the Lender without telling Mr M (i.e., secretly). And the second relates to the Lender’s compliance with the regulatory guidance in place at the Time of Sale insofar as it was relevant to disclosing the commission arrangements between them. However, for the reasons I set out above, I’m not persuaded that the Supplier – when acting as credit broker – owed Mr M a fiduciary duty. So, the remedies that might be available at law in relation to the payment of secret commission aren’t, in my view, available to him. And while it’s possible that the Lender failed to follow the regulatory guidance in place at the Time of Sale insofar as it was relevant to disclosing the commission arrangements between it and the Supplier, I don’t think any such failure on the Lender’s part is itself a reason to uphold this complaint because, for the reasons I also set out above, I think Mr M would still have taken out the loan to fund the purchase at the Time of Sale had there been more adequate disclosure of the commission arrangements that applied at that time. Conclusion In conclusion, given the facts and circumstances of this complaint, I do not think that Mr M has a valid claim under Section 75 CCA and I am not persuaded that the Lender was party to a credit relationship with him under the Credit Agreement that was unfair to him for the purposes of Section 140A of the CCA. And having taken everything into account, I see no other reason why it would be fair or reasonable to direct the Lender to compensate him. My final decision I don’t uphold this complaint for the reasons set out above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr M to accept or reject my decision before 24 April 2026. Philip Gibbons Ombudsman

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