November 13th 2024.
According to Martin Lewis, there is potential for a scandal of PPI proportions in the car finance industry. This means that even more car owners could be entitled to thousands of pounds in compensation due to the alleged mis-selling of finance deals. The founder of Money Saving Expert has noticed a surge in consumer complaints after a recent Court of Appeal ruling declared it illegal for finance providers to pay commissions to car dealers without the informed consent of their customers.
In response to this ruling, the Financial Conduct Authority (FCA) has announced that it is considering extending the time frame for banks to handle commission complaints from customers. This not only applies to discretionary commissions, which incentivized car dealers to increase interest rates without customers' knowledge, but also to all car finance commission complaints. According to Lewis, this move by the FCA suggests that they may broaden the scope of their investigation into car finance in the future.
While there is a possibility of a Supreme Court appeal, Lewis believes that if the time frame is extended, it could potentially lead to payouts for almost everyone who has had a car finance deal. This would more than double the number of people involved and could result in a substantial threat to the car finance industry, similar to the PPI scandal. So how might this affect you?
Lewis predicts that this change could make it more likely for consumers to receive payouts in cases involving discretionary commissions. However, it is uncertain if this will also apply to fixed commissions, as it will depend on the outcome of a possible Supreme Court appeal. In light of this, Lewis advises people to log their complaints as soon as possible, including fixed commission complaints, to avoid missing out on potential compensation due to a time bar.
Overall, it is estimated that millions of people could receive an average of £1,100 back if they make a complaint to the finance company they used. This news serves as a reminder for car owners to be aware of their rights and to take action if they believe they have been a victim of mis-selling in the car finance industry.
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