Martin Lewis 'All' drivers with car finance complaints could receive compensation

finance
Created 11/13/2024
Updated 11/13/2024

The Financial Conduct Authority (FCA) is preparing to extend the timeframe for motor finance companies to handle a surge in consumer complaints, following a Court of Appeal ruling that deemed it illegal for banks to pay commissions to car dealers without customers' informed consent. This decision is expected to lead to a significant increase in complaints about alleged mis-selling practices in the car finance sector. The FCA plans to publish proposals soon, with potential implementation by mid-December. Financial expert Martin Lewis confirmed that this applies to all car finance commission complaints, not just those involving Discretionary Commission Arrangements (DCAs), which allowed dealers to increase their commission by raising interest rates. The ruling could result in widespread refunds to consumers, drawing parallels to the costly PPI scandal. Analysts predict that compensation costs could exceed £16bn, with companies like Close Brothers potentially facing liabilities surpassing their market value.

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