After a recent investigation into BMW finance, the German car manufacturer has agreed to compensate $72 million to its customers.
Australian Securities and Investment Commission (ASIC) in its investigation found that BMW Finance (German car manufacturer BMW’s finance unit) had violated responsible lending laws between January 2011 and August 2016.
ASIC found thousands of customers may have been unfairly hit by its lending and debt collection practices.
"BMW Finance had a sales-driven culture that failed to comply with the requirements of the credit laws and resulted in poor outcomes for many consumers,” ASIC deputy chairman Peter Kell said.
As a result, BMW Finance has agreed to take part in a $72 million credit remediation program, which CHOICE stated was largest on record in Australia.
The program will benefit about 15,000 BMW Finance customers who ASIC says "may have suffered hardship as a result of BMW Finance's compliance failures".
“We are encouraged that BMW Finance has recognised these shortcomings and agreed to a remediation program that will see thousands of consumers compensated," says ASIC deputy chairman Peter Kell.
BMW Finance offers loans for a number of vehicle types and brands, including used vehicles. The finance firm also goes by the names of Mini Financial Services and Alphera Financial Services.
$14.6 million will be used to repay BMW Finance customers. The company has also agreed to write off $50 million worth loans of its customers and $7.6 million will be used towards reducing interest rates on current contracts.
BMW Finance will also be ponying up $5 million to help prevent consumers from getting stuck in bad car loans in the first place. The money will go toward consumer advocacy and financial literary initiatives.
How to get compensated
If you were a customer of BMW Finance between January 2011 and August 2016 and believe you have suffered unreasonable hardship as result of the terms and conditions of the loan, you can get in touch via the following contacts:
- 1800 448 225 from 08.00 to 17.00, Monday to Friday (excluding public holidays)
- BMW: CustomerFirstAUS@bmwfinance.com.au
- Alphera: CustomerFirstAUS@alphera.com.au
- MINI: CustomerFirstAUS@minifinance.com.au
