By Tony Willard
Automotive Compliance, appointed by the Financial Conduct Authority as a motor industry regulator, says fines totalling £928,00 imposed on three former senior Swinton Group executives underline the need to put customers first.
The FCA said a culture was allowed to develop within Swinton that pushed for high sales and increased profit without regard to the impact on customers.
Paul Guy, managing director at Automotive Compliance, said: “Pay plans should reward for treating customers fairly. The action against the Swinton trio highlights how the FCA will hold individuals responsible.”
Automotive Compliance is an FCA principal firm for consumer credit and the only appointed representative network in motor industry general insurance. Dealers can join its network and sell consumer credit and/or general insurance products without direct FCA authorisation.
Guy said the FCA requires dealer groups to appoint a director responsible for the policy and culture created in selling F&I products. Dealers are currently completing their applications to move to full or limited permissions for consumer credit.
“They are asked to tick boxes saying they have regulatory business and risk mitigation plans, and a compliance monitoring programme as required, and procedures to counter the risk of financial crime,” he said. “The FCA’s message is clear: compliance is not just a tick-box exercise and dealers will be held responsible.”
A motor retail sector consultant said: “The challenge facing dealers is not just a change in processes and controls to comply with FCA regulation. They need to ensure a cultural shift, placing customers’ needs ahead of a dealership’s to be profitable. Profit and a good customer outcome are not mutually exclusive and it is this balance dealers will need to develop.”