Loophole on HPI checks
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II The Department of Trade and Industry is being urged to close a legal loophole which makes truck operators liable for vehicle registration mistakes made by their finance houses.
Most finance and leasing companies register finance agreements on trucks with credit checking firm HPI, which currently holds details on more than five million agreements.
Truck dealers and auction houses carry out an HPI check each time they buy a vehicle to ensure there is no outstanding finance on the truck.
But as there is no law requiring HPI registration, dealers
and auctioneers can find themselves with trucks to which they have no legal title because the finance or leasing company failed to register an agreement, or made a mistake when entering its details. Dealers and auction houses then have no alternative but to sue the company which sold them the truck.
Leominster auction house Russell Baldwin and Bright, which handles sales of cars, 4x4s and commercial vehicles, says it is almost £80,000 out of pocket as a result of errors or "laziness'' on the part of leasing and finance companies during the past year.