FCA Consultation on Motor Finance Complaints

Earlier this year, we updated the sector on the threat of claims for so-called secret commissions under the now banned Discretionary Commission Arrangements.

Today, 30th July 2024, the Financial Conduct Authority (FCA) published a new consultation paper and an accompanying press release.

In summary, the FCA is proposing to extend the current pause to 4th December 2025, which is the earliest time that firms will have to respond to motor finance complaints about Discretionary Commission Arrangements. That pause will allow the FCA to consult on a redress scheme or ask firms to deal with motor finance complaints relating to DCA models. The deadline for responding to the consultation is 28 August 2024.

In addition, the FCA is also proposing to give consumers until the later of 29 July 2024 or 16 months from the date of their final response letter to refer any complaint to the Financial Services Ombudsman (FOS).

The FCA will set out its next steps in May 2025 (and not September 2024 as previously announced) to allow it time to collect data and first consider the outcome of the Barclays Bank Judicial Review case against the FOS.

If you have any queries regarding this article, please contact Geldards’ Automotive Team.