This horse has definitely bolted!
The ongoing motor finance commission saga continues on its merry way, and we all wait expectantly for the Financial Conduct Authority (FCA) to produce its findings from its consultation CP25/27, Motor Finance Consumer Redress Scheme, and to develop a redress scheme that aims to please everyone!
At the beginning of this month, the FCA announced it would open an enforcement investigation into a claims management company (CMC), namely The Claims Protection Agency Limited (TCPA), following concerns about its advertising and sales tactics relating to potential motor finance claims.
As we all know, this matter has been ongoing since January 2021, and from the outset we saw ridiculous attempts by solicitors’ firms and claims management companies looking to profit from the FCA’s ban on discretionary commission arrangements. It was clear from this point that this was creating a problem and the compensation figures being promised to consumers were obviously unsupported by hard facts. However, those promises did the job of building up a large database of consumers who believed in promises of compensation.
This looks like a strategic effort by the FCA to show the public it is working on their behalf. However, the question should be asked why it did not do this from the start. In July 2020 its policy statement, ‘Motor Finance discretionary commission models and consumer credit commission disclosure – feedback on CP19/28 and final rules’, was always likely to create the same problem as the PPI saga. This was not their first rodeo! The review was going to draw out the predators again and begin their ‘Where there’s blame, there’s a claim’ campaigns.
The FCA has created this problem and, five years on, is attempting to ‘show its teeth’ by telling consumers they do not need to sign up with these companies, whose advertising and sales tactics have been underhand. If the FCA had sent a clear message at the start, we would not be in this position now.
If you are still concerned about the motor finance commission saga, contact Lawgistics and we will be happy to discuss it. Our telephone helpline and casework team can review historic commission arrangements and responses to the FCA process. We will keep you informed of any further FCA updates on this matter.
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