The FCA Announces Investigation
In 2021, the Financial Conduct Authority (FCA) banned the practice of ‘discretionary commission arrangements’. This practice meant brokers could adjust the interest rates offered to customers when buying a car on finance. In simple terms, the higher the interest rate the customer paid, the more commission the broker received. As we are well aware of at PCP Claim UK, many consumers have been complaining about how much they were charged before the ban was put in place. These complaints have led to the FCA opening an official investigation into car finance complaints.
The FCA has launched a significant financial mis-selling investigation to assess the extent of the problem and ensure compensation is delivered to motorists who may have been affected. While consumers have been able to complain, many firms have falsely rejected complaints because they don’t believe they have acted unfairly or have caused customers to lose out. The investigation will affect consumers who bought a car on finance before 28 January 2021 and if their broker had a discretionary commission arrangement. It will not affect consumers who bought a car on finance after this date or had a hire agreement such as a Personal Contract Hire.
What This Means for You
In the words of Money Saving Expert’s Martin Lewis, could this be the “new PPI” scandal? Martin notes that this is a significant step that could lead to millions of consumers receiving thousands in compensation.
If you fit the criteria mentioned above, such as you bought a car on PCP finance before 2021, you might be eligible to claim and receive compensation for financial mis-selling. The scandal means you may have paid a higher interest rate than you should have on your agreement due to the hidden commission fees.
While the FCA is investigating the issue, they have paused the 8-week deadline for firms to respond to complaints. Therefore, lenders don’t need to respond to your complaint until at least 25 September 2024. However, Martin Lewis has encouraged consumers to start getting their complaints in now to avoid missing out and ensure they are in the queue when action is taken
While there are no guarantees mis-selling will be proven and action will be taken, the FCA carrying out a full review of how complaints have been handled is a significant sign they believe complaints have falsely been rejected and will implement a scheme for distributing compensation. How much compensation people could be entitled to is still uncertain, but it could be in the thousands.
Check if You’re Eligible for a PCP Claim Now
PCP Claim UK is here to offer advice and help you get compensation. We understand your rights and know the importance of transparency and integrity for consumers when buying a financial product. You may be able to claim with us for various reasons, including if the lender didn’t tell you about sales commissions, you paid a high-interest rate, and you bought the car in the last 10 years.
Our team comprises dedicated claims experts who’ve worked on hundreds of successful claims. We will ensure your claim is correct and that adequate supporting documents are submitted to maximise the compensation you receive. We will make the process quick and easy for you, handling the hard work and time-consuming takes so you can sit back while we secure your compensation. We work on a no-win, no-fee basis, so you only pay our fees if the claim is successful.
The journey starts with our free online checker. In two minutes or less, you can check to see if you might be eligible for a PCP claim. The checker will ask a few simple questions, such as your vehicle registration, when you leased the vehicle and how you financed the agreement. Our system will tell you within seconds whether you might be eligible. If we think you have a case, you can leave your contact details with us, and we will be in touch to help you proceed.
Check now to see if you’re eligible to reclaim.