FCA announces temporary complaint-handling rules relating to certain motor finance complaints

Businesses will have more time to issue final responses to complaints from consumers while the FCA assesses how these cases are being handled, so it can decide whether further action is needed.  

The FCA action comes as the Financial Ombudsman Service issued its first final decisions on motor finance commission – published on our decisions database. 

Commenting on the FCA’s action, Abby Thomas, Chief Executive and Chief Ombudsman, said: 

When people take out a car loan it’s imperative they are treated fairly and the financial implications are totally transparent. 

Unfortunately, that is not always the case. We’ve heard from more than 10,000 people who fear they were charged too much for their finance, and we know many more are waiting in the wings. 

We’ve resolved two complaints where we found that the way the commission arrangement between the lender and the car dealer worked was unfair on the consumer. Our decisions could signal the way forward for many more similar complaints that have not been resolved between firms and consumers. 

That’s why I welcome the Financial Conduct Authority’s decision to assess this issue further. In the meantime, we’re totally committed to continuing to investigate cases with our service. 

If people are concerned about their car loans and are unhappy with how firms have responded, they can come directly to our free, independent service and we will investigate their complaint.”

Complaints that are already with our service will not be affected.  

Find out more

• If you’re a consumer looking for information, read more about how we can help. 
• If you’re a business looking for information, read more about how we handle complaints. 
• Decision reference: DRN-4188284
• Decision reference: DRN-4326581
• Not all motor finance complaints that come to us involve a discretionary commission model. Today we have also issued a final decision in a case where the lender paid the car dealer a fixed amount of commission. These fixed or flat commission arrangements are not caught by the FCA’s temporary complaint-handling rules.