Eastern Western Motor Group (EWMG) in Scotland has become the first dealer to be publicly censured by the Financial Services Authority since legislation for selling insurance was introduced in 2005.

The Broxburn-based business, which concentrates on premium franchises such as Saab, Mercedes-Benz, BMW and Lexus, has been criticized for failing to correctly monitor sales of payment protection insurance (PPI) on car finance agreements.

AM revealed last September that Eastern Western was in trouble with the FSA, although the group denied any failings. The FSA has now declared that records were inadequate, sales staff were not correctly trained or monitored, and customers did not receive a statement of the total PPI price.

The FSA says EWMG escaped a fine due to the small number of PPI policies actually sold – less than 1% of all vehicle sales. Only one complaint was received, and EWMG had sought compliance advice prior to the FSA’s action.

Sandy Risk, EWMG’s FSA compliance manager, says: “Dealerships have written to the small number of customers who purchased PPI and have furnished them with a total price figure.”