The bottom lineThe FCA says it is still seeing motor finance claims advertising that can blur key facts for consumers, and it is escalating supervision with partner regulators.
What happened
The Financial Conduct Authority said its joint taskforce with the Advertising Standards Authority, the Solicitors Regulation Authority and the Information Commissioner's Office is continuing to tackle poor handling of motor finance claims by some claims companies and law firms.
In June, the FCA said it had 170 misleading car finance claims adverts removed or amended by claims management companies, taking the total to 1,200 since January 2024.
- The FCA said some ads were disguised as consumer social posts.
- Other ads used the FCA motor finance redress scheme in a misleading way.
- The regulator said some promotions failed to make clear that consumers could claim for free or that the firm was not authorised to provide the service.
Why it matters
For retail consumers, the issue is not the existence of car finance complaints, but how claims firms market their services. The FCA said misleading promotions can obscure key facts, pressure consumers to sign up and create confusion about free routes to complain.
The FCA also said it agreed voluntary requirements with two firms in June, bringing the total to 12 in the last 12 months, and issued eight alerts against unauthorised firms promoting regulated claims management activity without the required authorisation.
- Using a claims management company or law firm may mean paying fees of more than 30% of any compensation, according to the FCA.
- The FCA said more than 28,000 consumers have been able to exit contracts free of charge since January 2024.
- The FCA also said three claims management companies reduced unreasonable fees, protecting over 500,000 consumers.
What readers can check next
The FCA says consumers who have not yet complained about car finance can complain directly to their lender for free, and it has published contact details and a template letter for those who want to raise concerns about a claims firm.
Readers can also check whether any claims firm is authorised and whether a promotion clearly explains fees, free alternatives and the role of the FCA before signing anything.
- Check the lender first if you want to make a car finance complaint.
- Avoid signing up with multiple claims firms, which could lead to multiple fees.
- Be wary of ads that suggest an official link to the FCA or that hide the fact they are paid promotions.
Editorial note. This report explains a public record and is not investment, legal or trading advice. Facts may change after publication; the source links remain the controlling record.
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