| Link(s): | An update on car finance commission complaints (financial-ombudsman.org.uk) Complaints about car finance commission (financial-ombudsman.org.uk) |
Context
FOS has published an update about its car finance commission cases.
Key points to note and next actions
FOS currently has around 20,000 open complaints related to car finance commission and, in January 2024, published its first, representative, final decisions fully addressing the arguments it had received across a range of motor finance complaints.
Subsequently, in March, three court cases relating to car finance commission were granted permission to go to the Court of Appeal. The hearing has not yet taken place, although the decision is expected to consider how the law relating to secret and half-disclosed commission might apply to motor finance commission payments.
In April, Clydesdale Financial Services Limited, trading as Barclays Partner Finance, started judicial review proceedings in relation to one of FOS’ decisions. The judicial review hearings have not yet taken place.
It is recognised that both the judicial review and the Court of Appeal’s decisions could have an impact on the FOS approach to complaints that include similar issues. As the FOS doesn’t know when the decisions from the courts can be expected, it is unlikely to be able to issue final decisions on affected cases for some time.
On 11th January 2024, the Financial Conduct Authority (FCA) announced a review of the historical use of motor finance discretionary commission arrangements. As part of this, the FCA paused the requirement for firms to issue final responses in some Discretionary Commission Arrangement cases. The FCA has committed to provide further information about next steps by 24 September 2024.
While both the FCA review and the court proceedings take place, FOS continues to accept and investigate complaints as far as it can.
FOS have published information for financial businesses who are responding to complaints, which explains:
- FOS current approach to cases
- how the FCA’s current guidance about car finance complaints applies to complaints, and
- what FOS need financial businesses to send across to FOS when they receive a complaint about car finance commission.