Germany-based world-renowned automotive giant Volkswagen is currently facing quite a tumultuous process. The company has officially received a legal blow for not treating financially struggling customers fairly and for forcibly taking back vehicles from customers who could not make loan payments despite having no rights. Here are the details and what you need to know…
Volkswagen will pay compensation to customers and the court!
The German automotive giant Volkswagen is facing heavy penalties in the UK for not treating financially troubled customers fairly.
As a result of a comprehensive investigation by the Financial Conduct Authority (FCA), Volkswagen Financial Services Ltd (VWFS), the company’s financial arm, will have to pay approximately £21 million (around 935 million TL) in compensation to a total of 110,000 customers.
The investigation covering the period from 2017 to 2023 focused particularly on the policies pursued against customers facing financial difficulties during the pandemic. VWFS was accused of not showing sufficient flexibility to customers in payment difficulties and effectively ‘seizing’ their vehicles.
One of the most striking findings revealed during the investigation was that the company strictly enforced contract terms by seizing vehicles from customers experiencing financial difficulties. According to the FCA, although these practices were in line with contracts, financing companies have a responsibility not to put their customers in even more difficult situations.
The court imposed a fine of over £5 million on Volkswagen Finance with its ruling. Additionally, the company was ordered to pay compensation to the 110,000 affected customers.
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