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The boss of Close Brothers has resigned for health reasons, as the company becomes embroiled in the scandal affecting the motor finance sector.
Adrian Sainsbury, who joined the 147-year-old bank in 2013 and became chief executive in 2020, resigned on Monday after taking medical leave in September.
Embattled Close Brothers did not elaborate on the reason for his leave, but said he is “recovering well and is expected to make a full recovery.”
Sainsbury, 56, has been replaced by Mike Morgan, who joined as finance director in 2010 and has been in temporary charge since September. Morgan, 59, takes over at a crucial time for the auto finance industry.
Health problems: Adrian Sainsbury, who became chief executive of Close Brothers in 2020, resigned on Monday after taking medical leave in September.
The sector is facing a crisis over the Supreme Court’s upcoming decision on whether to uphold a judgment on mis-selling of loans handed down by the Court of Appeal in October.
Judges then decided it was illegal for car dealers to obtain commissions from lenders without receiving customer consent for payment.
It means that customers should have been clearly told how much commission the distributors would earn and accept it.
Firms such as Close Brothers have been setting aside hundreds of millions of pounds amid estimates that lenders could face a £30bn compensation bill.
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