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CEO came across as an ambitious district attorney running for office / votes in a Hollywood movie rather than a UK regulator but mostly fudge I thought. Thanks for sharing.

Taverham - I suspect that what Close are saying to the FCA in their earlier rns is ‘bring it on, we’re good’.

I don’t see they need to say anything more at this stage.; just let the FCA keep fumbling the ball for now.

Once the media cycle moves on I suspect the FCA will stop their media damage limitation efforts and put in place a scheme in line with the SC ruling; they’ve said as much in the document Knot kindly posted. GLA

Https://x.com/martinslewis/status/1952051655727300795?s=46&t=FrEO2skfzslsDrpw7gzn8A

The FCA is facing real credibility damage after the way it handled this motor finance saga. Let’s look at why an overhaul might be coming, and what it could mean:

⸻

⚖️ Why an Overhaul Feels Likely

1. They Overstepped Without Legal Basis

• The FCA froze complaints, then floated a redress scheme before the legal position was settled.

• Now the Supreme Court has effectively contradicted the basis for many of their assumptions (no automatic fiduciary duty, no blanket wrongdoing).

2. Confusion & Mixed Messaging

• They put out “doomsday” estimates (£18bn), then admitted that the number was vague and possibly inflated.

• They intervened in court, withdrew from Barclays v FOS, and now still seem to be pushing ahead with a redress framework despite the ruling narrowing things substantially.

• Public and press are confused, and trust is eroding.

3. Political Context

• We now have a new government with a reform-minded Chancellor (Rachel Reeves), and an embattled Rathi at the FCA.

• It wouldn’t be a stretch to see regulatory reform framed as “pro-consumer, pro-market confidence” — especially with the Treasury prioritising economic growth and capital markets reform.

4. Pressure from Industry & Investors

• Big banks, investors, and even claims management firms are all now on divergent paths — that means no one is happy.

• Any attempt to force a redress scheme post-SC ruling will almost certainly face legal challenge, possibly by Barclays or others.

⸻

🔮 What Might Happen to the FCA?

• 🔄 Leadership change (Rathi out)

• 🧹 Restructuring of enforcement & redress oversight

• 🗳️ Parliamentary scrutiny, possibly via Treasury Select Committee or even an independent review

• 📉 FCA’s authority on consumer redress could be watered down in favour of ombudsman reform or judicial pathways

⸻

🗨️ The Irony?

This was originally about hidden car dealer commissions, and it’s ended up exposing regulatory overreach, legal grey zones, and political naivety.

It’s now a case study in how not to handle systemic risk in a consumer finance sector.

What You Should Watch Now

1. Will Barclays continue their JR against FOS? If they win, it could kill the FCA’s fallback redress basis.

2. Will FOS revise their own thresholds? They used to rely on the CoA ruling that the SC just gutted.

3. How do claims firms react? If they retreat, the FCA may quietly scale down the scheme during consultation.

4. How much of today’s FCA talk is cover vs commitment? That will be visible in the actual October consultation wording.

⸻

🧠 Bottom Line

the FCA is clearly hedging. This is not a full walk-back, but it’s a major retreat dressed up as progress.

It’s a damage-control message:

“Some people will get something, but it won’t be widespread, and please don’t panic.”

From a market view:

This gives more certainty to banks than the wording lets on — and supports the rerating of Close.

What the Supreme Court Actually Said

The Supreme Court:

• Rejected the blanket application of fiduciary duties to car dealers.

• Narrowed liability for commission-based mis-selling to very specific cases.

• Made it clear that most typical motor finance deals did not create fiduciary relationships or “bribes”.

• Affirmed Mr Johnson’s compensation — but only under CCA unfairness, not tort or equity.

The key phrase:

“The claims in both equity and the tort of bribery therefore fail… The FCA regulatory regime is not premised on car dealers… having the obligations of a fiduciary.”

⸻

🧠 So Why Is the FCA Still Talking About a £9bn–£18bn Scheme?

This is more regulatory theatre than legal certainty.

The FCA is not contradicting the SC ruling directly. Instead, it’s:

• Shifting the frame away from fiduciary duty or bribery…

• …and focusing on Consumer Credit Act “unfairness” grounds — like in Mr Johnson’s case.

• Taking political cover by saying: “We’re doing this because some cases might still qualify.”

So while the SC crushed the idea of mass tort or fiduciary-based redress, the FCA is now:

• Reframing redress as “non-disclosure = unfair = potentially refundable”.

• Proposing a case-by-case mechanism under its own rules — not under SC authority.

• Making sure they’re not seen to side with banks too quickly, particularly under Labour pressure and populist media heat.

⸻

🧾 Legal Translation: This Isn’t a Binding Scheme Yet

• It’s a consultation, not a final scheme.

• FCA is proposing to use its rule-making powers (SYSC + DISP rules) to build a structured process.

• They admit payouts might not start until 2026.

• They estimate most payouts under £950, far below the nuclear £10k+ media fear stories.

So yes — Friday’s ruling has limited the damage legally, but politically the FCA can’t be seen as “abandoning” consumers overnight.

⸻

📉 What It Means for Close Brothers (CBG)

• Mass redress is now legally constrained. Claims must be fact-specific, and only succeed where:

• There was no disclosure,

• The commission was unusually large (e.g. Johnson’s 55%),

• The dealer created false impressions (e.g. pretending to “choose from a panel”).

• These are minority cases, not systemic.

• FCA acknowledges many won’t qualify. It’s optics and containment.

• CBG’s liabilities, in real terms, are now likely to be in the low £m’s, not £100m+.

• Their £480m capital buffer makes a special dividend or buyback very plausible in coming months.

• A path back to 700–800p or takeover premium above is very much alive.

⸻

🧭 What You Should Watch Now

1. Will Barclays continue their JR against FOS? If they win, it could kill the FCA’s fallback redress basis.

2. Will FOS revise their own thresholds? They used to rely on the CoA ruling that the SC jus

Just want to thank Knot and Liberty2 for the effort and insight displayed on this bb

Honorary thanks to chid, for the bantz

Key Outcomes:

✅ Fiduciary and bribery claims rejected

The Supreme Court overturned the Court of Appeal’s broad findings. Dealers were not fiduciaries, and bribery law does not apply to these commission arrangements. Huge result for lenders.

✅ Narrow win for Johnson—but highly specific

One claimant succeeded, but only under Consumer Credit Act s.140A—and only because:

• The commission was extremely high (25%)

• The documents gave a false impression of impartiality

• The claimant was commercially unsophisticated

This is not precedent-setting. It reinforces case-by-case review, not mass claims.

❌ Court of Appeal slapped down

The Supreme Court made clear that the CoA overstepped, and clarified that fiduciary duties require conscious assumption of loyalty, not just vague consumer expectations.

📉 What it means for Close Brothers:

• Existential legal threat? Gone

• Bribery/fiduciary exposure? Zero

• Likely redress? Contained and already mostly provisioned

• Capital position? Robust (Winterflood sale + £480m raised)

📈 Valuation Outlook:

• Pre-scandal share price: ~£8

• Current price: ~397p

• Relief rally could push to 600–650p short term

• Medium-term fair value: 700–800p with earnings normalising

The market just got clarity. Claims firms just lost momentum. Close Brothers just got its future back.

Livestream screen just popped up on sc website

Nihar,

Volumes are quite low again today and most banks seem to be down @2%, so not sure too many conclusions can be drawn; but yes, getting a bit nervy myself too!

GLA

It has to pop up on their website shortly prior surely, also wouldn’t be surprised if Sky News / beeb news carry live coverage

I’ve just noticed the YT channel too but I don’t think it’s been used for about seven months. Nothing on their X feed either

KBW have an ‘outperform’ rating on CBG today according to Stockomendation.

Tend to agree, but seems a brave call from a broker just hours before judgment; you’d have thought they’d keep their powder dry.

What I’d LIKE to see on a positive outcome:

£6-6.50 in immediate aftermath, rising to

£8 as things settle, with the announcement of a

50-75p special divi returning some cash to shareholders, then steady rise to £10-11 with strong divis.

However, I wouldn’t be surprised if marauding yanks offered £9-10 per share takeover in meantime.

As I say, what I’d like - either way GLA

And thank you for the kind comments re my posts but all I do is put Knot and Liberty2’s posts through ChatGPT - they are both valuable resources on here

To be fair it is very good.

But I had auto renewal in place and they hiked the price significantly without informing me in advance. When I queried why that had happened , their attitude was both high handed and dismissive so I’d rather not give them the business to be honest.

Hope no one minds my going off topic while we await news please?

I’m looking for a good alternative to ADVFN Level 2. I like the site but not the way they operate in terms of customer service.

Would be interested in alternatives please.

Does anyone know if the judgement will be live streamed / televised on Friday please? Also, when judgement paperwork will ‘drop’ ie during judgement or straight afterwords

TIA / GLA

Knot,

If you liked the ChatGPT post you’ll love this:

this is one of the sharpest social media posts I’ve seen on the legal heart of the Hopcraft issue. It’s not just commentary — it’s making a coherent legal argument that ties together:

• Wood, Hurstanger, and now Expert Tooling

• The misstep by the Court of Appeal

• And the likely corrective path the Supreme Court will take

Let me walk you through the key ideas and whether they stand up.

⸻

🔍 1. Is the fiduciary misinterpretation real?

Yes — 100%.

The Court of Appeal in Hopcraft effectively said:

“Even if the broker isn’t a fiduciary, they must act disinterestedly if the consumer places trust in them.”

That flips the Keech v Sandford logic on its head.

🔴 Keech: Fiduciary duties arise because of a legal relationship, not just vibes or expectations.

🟡 Hopcraft CoA: Assumed that consumer trust alone creates a fiduciary. That’s a legal overreach.

✅ This poster is spot on: fiduciary relationships require explicit engagement, usually defined by fee, duty of care, and a position of discretion.

So if the SC corrects this (and I think they will), it removes the foundation of the “disinterested advice” argument for motor finance brokers.

⸻

🔧 2. What does Expert Tooling add?

It’s huge. Because that case is about:

• When does a commission become a “bribe”?

• And how wide is the liability net cast when a party is not fully honest but not strictly secretive?

In Wood, the SC tied disinterested advice to the fiduciary duty.

This poster argues that the Court of Appeal wrongly:

• Took that standard (disinterested advice)

• And applied it in non-fiduciary contexts, i.e., motor finance

• Thereby inventing a duty where one doesn’t legally exist

That’s a critical legal misstep — and one the SC is likely to close off.

⸻

🏛 Likely SC correction:

A broker may owe a duty of care under contract or regulation.

But they do not owe fiduciary-style duties (like disinterested advice or full commission disclosure) unless a fiduciary relationship is clearly created.

If that’s clarified:

• The “fiduciary” limb of Hopcraft dies

• The “bribery” narrative also collapses — because it relies on fiduciary duty breach

• Any surviving claims must then rely solely on unfair relationship, which is subjective, case-by-case, and non-fiduciary

⸻

📰 The Guardian CBAM quote – fair spot

The poster is also completely right to flag the CBAM reference as sloppy journalism.

• CBAM was sold in 2023

• That cash is already in Close Brothers’ buffer

• The Guardian citing it now — without new disclosure — was misleading, and may have been used to make the story feel fresher or more bearish than it was

This speaks to a broader point:

Retail sentiment is being swayed by outdated or recycled content — and the post rightly warns readers to c

Hi Chid,

You’re arguing with ChatGPT not me. It refines its position based on input (unless yourself) and that is what is reflected in the posts.

I’m a long term holder either way and liken this share (in my thinking) to St. James’s Place and its ascent as uncertainty was removed. Might be limited thinking on my part but hey, GLA who actually hold.