UK's Volkswagen Finance to pay £21.5m in compensation after FCA fines for unfair practices

The City regulator has imposed a £5.4m fine on Volkswagen's UK financial services division for its unjust treatment of customers facing financial hardship, which it believes may have resulted in harm.

The Financial Conduct Authority (FCA) announced that Volkswagen Finance has agreed to compensate approximately 110,000 affected customers with over £21.5m following the investigation, as reported by City AM.

From 1 January 2017 to 31 July 2023, Volkswagen Finance repossessed cars from vulnerable customers without exploring other alternatives, according to the FCA.

The authority further stated that this action risked exacerbating the customers' situation, particularly if they relied on their car for commuting to work.

Volkswagen Finance failed to comp