Ad description

A radio ad for Trade Centre Wales, heard on 13 February 2022, stated, “Trade Centre Wales is proud to offer probably the UK’s cheapest cars with hundreds of cars from just twenty pounds a week. Fiestas, Corsas, Fiat 500s; all just twenty pounds a week. Drive away today for just twenty pounds a week with ninety-nine pound deposit. See our price promise online. Trade Centre Wales. Open ‘til six tonight at Neath and Cardiff North. Cash price three nine nine nine. Deposit ninety-nine. Credit amount three thousand nine hundred. Two, sixty weekly payments of twenty pounds. Total payable five two nine nine. Representative APR twelve point nine per cent, twelve per cent fixed.”

Issue

The complainant, who was unable to find a car at the stated £20 weekly price, challenged whether the ad was misleading.

Response

The Trade Centre Group plc t/a Trade Centre Wales (Trade Centre) said that on 13 February 2022 they had over 1,400 cars at their Neath and Cardiff North locations combined, although they were not able to specify how many of those had been available at £20 per week or the alternative cash price of £3,999.

Trade Centre explained that the £20 per week price was a finance deal. They were an FCA-authorised credit broker and introduced their customers to lenders. Trade Centre were responsible for ensuring that the customer was aged 18 or over and did not identify as a vulnerable customer. Every customer had the opportunity of credit at the lowest rate, but must meet the terms and conditions set out by the lender in order to qualify.

They said the majority of their customers did not pay more than 12.9% APR. If a customer was declined credit at 12.9% or lower their application was offered to an alternative lender with the next lowest APR, and so on until an approval was secured. Some customers would be declined by all lenders; credit was not guaranteed.

Trade Centre provided information about 18 cars that were first advertised at £3,999 in the first two weeks of February 2022. Five of those customers opted for finance agreements, but none took on finance at the £20 per week rate, for various reasons. Trade Centre said the reasons that payment amounts for customers who opted for finance varied from the advertised £20 included, that they: paid larger or smaller deposits than the £99 referenced in the ad; wanted a shorter or longer loan term than the 260 weeks referenced in the ad; had a part exchange; or had an existing credit agreement that they wanted to settle within the loan.

Radiocentre did not have any comments additional to those from Trade Centre.

Assessment

Upheld

The ad stated that “hundreds of cars” were available from the advertiser “from just twenty pounds a week”, and referred to cars costing “just twenty pounds a week” twice more. The ad then stated the deposit amount required, the amount of credit and total payable amount, the repayment period and the representative APR (both variable and fixed).

The ASA understood that cars were available for £3,999 from the advertiser, and as such were theoretically available for £20 per week, but that not every individual would be eligible for the finance offer described in the ad.

The ad was for a financial promotion and the Consumer Credit Sourcebook (CONC) rules and guidance therefore applied. CONC rule 3.3.1 stated “A firm must ensure that a communication of a financial promotion is clear, fair and not misleading”, and rule 3.3.3 stated that “A firm must not in a financial promotion […] state or imply that credit is available regardless of the customer’s financial circumstances or status.”

We acknowledged that the voice-over first stated that the finance offer was “from just” £20 per week, but noted it then stated that it was “just” £20 per week twice after that. We considered the ad placed significant emphasis on the availability of cars at the weekly price of £20. It referenced some conditions to that finance offer, but did not include a statement which made clear that other terms and conditions applied. In particular, it did not include any statement, such as “Terms and conditions apply”, that communicated to listeners that the £20 per week finance offer would only be available to those who met the eligibility requirements. As such, we considered listeners would understand from the ad that they would be able to purchase a car from Trade Centre Wales with a finance agreement allowing them to make repayments at £20 per week, regardless of their financial circumstances or status.

Additionally, CONC rule 3.7.5 required that financial promotions must specify “the legal name of the firm as it appears in the Financial Services Register and not merely a trading name” and rule 3.7.7 (1) stated “A firm which is a credit broker […] must ensure that any financial promotion states prominently that the firm is a credit broker and that it is not a lender.” We noted the ad referred to Trade Centre Wales, which did not appear in the Financial Services Register, rather than The Trade Centre Group plc, and also did not state they were a credit broker and were not a lender. We considered the absence of that information contributed to the impression that anyone would be eligible for the finance offer.

Because the ad misleadingly implied that all listeners would be eligible for the finance offer described in the ad regardless of their financial circumstances or status, and did not include other information required by CONC, we concluded the ad breached the Code.

The ad breached BCAP Code rules  3.1 3.1 Advertisements must not materially mislead or be likely to do so.  (Misleading advertising),  3.10 3.10 Advertisements must state significant limitations and qualifications. Qualifications may clarify but must not contradict the claims that they qualify.  (Qualification) and  14.11 14.11 The advertising of unsecured consumer credit or hire services by consumer credit businesses or consumer hire businesses and / or credit brokering¬† businesses or related credit services, such as debt counselling or debt adjusting is acceptable only if the advertiser complies with the financial promotions requirements imposed by FSMA and the FCA's rules set out in Chapter 3 of CONC..¬† The requirements for financial promotions set out in Chapter 3 of CONC do not apply: (a) where the credit is available only to a company or other body corporate (such as a limited liability partnership); (b) where a financial promotion is solely promoting credit agreements or consumer hire agreements or P2P lending agreements for the purposes of a customer's business; (c) to a financial promotion to the extent that it relates to qualifying credit or (d) it falls within the definition of an excluded communication as set out in the FCA's handbook. If the applicability or interpretation of these rules or provisions is in doubt, advertisers may contact the FCA. The FCA does not check financial promotions for compliance with the CONC rules before they are published. Such advertisements that involve distance marketing must also comply with the Financial Services (Distance Marketing) Regulations 2004 (as amended). Other distance-marketing financial advertisements are covered by the FCA Handbook.  (Lending and credit).

Action

The ad must not appear again in the form complained of. We told The Trade Centre Group plc t/a Trade Centre Wales to ensure its ads complied with the requirements of CONC. We told them to ensure their ads did not misleadingly imply that consumers would be eligible for described finance offers regardless of their financial circumstances or status.

BCAP Code

3.1     3.10     14.11    


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