PCP Mis sold Car Finance Claims

Discretionary Commission Arrangements – DCA Claims

PCP Mis Sold Car Finance Claims 

Discretionary Commission Arrangement – DCA

Make your Claim Today – Nationwide Service 

Tel: 01200 428 102


Have you financed a Car, Van, Motorhome, Truck (HGV) or Motorbike through PCP or Hire Purchase (not leasing) before January 28, 2021?


You might be owed ££££ thousands due to hidden, unfair car finance commissions.

Our team of solicitors specialise in addressing such disputes. If you suspect you’ve been a victim of Personal Contract Purchase, PCP  mis-sold car finance, we’re here to guide you through your legal options and ensure you receive rightful compensation.

Mis-selling occurs when essential information necessary for making an informed decision about a car finance product is withheld. The FCA has raised alarm over the possibility of ‘secret’ commissions, where car brokers might have been incentivised to charge inflated rates to earn higher commissions without disclosing this to the customer.

If the broker who facilitated your car purchase failed to provide comprehensive information, misled you regarding the finance product, concealed details about commissions and interest charges, or offered inadequate advice, you may have grounds for a claim.

The Financial Conduct Authority (FCA) is conducting a significant investigation into these practices, potentially resulting in billions of pounds in overcharged interest being returned to millions of affected individuals.


In around 40% of Personal Contract Purchases (PCP) car finance agreements, undisclosed ‘discretionary commission arrangements’ allowed brokers and car dealers to inflate interest rates to earn higher commissions, without consumers’ knowledge. While firms are currently on pause regarding complaints, it’s crucial to log your complaint early to mitigate the risk of being timed out later.


In January 2021, the FCA banned DCA ‘Discretionary Commission Arrangements’  to prevent lenders from increasing interest rates without consumers’ awareness. The FCA’s investigation, initiated on January 11, 2024, is gathering evidence firm by firm using its enhanced investigatory powers.


This is what the FCA are saying:-

FCA to undertake work in the motor finance market

In 2021, the FCA banned discretionary commission arrangements. This removed the incentive for brokers to increase the interest rate that a customer pays for their motor finance. We asked firms to review their practices and, where harm was identified, to address this.

There have been a high number of complaints from customers to motor finance firms claiming compensation for commission arrangements prior to the ban.

Firms are rejecting most complaints because they consider that they have not acted unfairly nor caused their customers loss based on the applicable legal and regulatory requirements.

The Financial Ombudsman Service has considered some complaints rejected by firms. It found in favour of complainants in two recent decisions. This is likely to prompt a significant increase in complaints from consumers to firms and the Financial Ombudsman.

Claims have also been brought in the County Courts, some of which have been upheld. So, there is significant dispute between some firms and consumers on whether firms have breached legal and regulatory requirements.

Consequently, we are using our powers under s166 of the Financial Services and Markets Act 2000, to review historical motor finance commission arrangements and sales across several firms.

If we find there has been widespread misconduct and that consumers have lost out, we will identify how best to make sure people who are owed compensation receive an appropriate settlement in an orderly, consistent and efficient way and, if necessary, resolve any contested legal issues of general importance.

In the meantime, we are pausing the 8-week deadline for motor finance firms to provide a final response to relevant customer complaints.

The pause will apply to complaints about motor finance agreements where there was a discretionary commission arrangement between the lender and the broker and will last for 37 weeks (approximately 9 months).

We are introducing the pause without consultation from today dated 11 January 2024. This is to prevent disorderly, inconsistent and inefficient outcomes for consumers and knock-on effects on firms and the market while we assess the issue and determine the best way forward. In deciding next steps, we will be informed by our statutory objectives to protect consumers, ensure market integrity and promote competition in the interests of consumers.

It is particularly important to manage these risks because, in line with most types of consumer credit, motor finance is not protected by the Financial Services Compensation Scheme.

This pause will apply to complaints received by firms on or after 17 November 2023 and on or before 25 September 2024.

For example, if a firm had been dealing with a complaint for 3 weeks at 11 January 2024, the time limit for responding to the complaint would be paused for 37 weeks until 25 September 2024. When the pause ends, the firm would have the remaining 5 weeks to provide its final response. If a complaint is received during the 37-week period, the 8-week deadline will expire on 20 November 2024.

The 37-week period will enable us to analyse the issues and decide what, if any, further action including legal steps are necessary. We may need to extend the pause if more time is required to make sure complaints are dealt with properly and consumers who might be owed compensation receive it.

Consumers will also have up to 15 months to refer their complaint to the Financial Ombudsman, rather than the usual 6 months. This extension applies to complaints where the firm had sent a final response in the period beginning with 12 July 2023 and ending with 10 January 2024, or where the firm sends a final response during the period beginning with 11 January 2024 and ending with 20 November 2024.


It’s likely that the FCA will establish a mass-scale redress scheme once the investigation concludes (currently planned for September), though there’s a slight chance it might not proceed. Acting under the assumption that such a scheme will be implemented is advisable. This guide outlines a simple complaint route for affected individuals, rather than a more complex legal route.


Take action now if you suspect your car finance involved a discretionary commission arrangement. While firms can delay decisions on complaints received after November 17, 2023, during the investigation, it’s wise to lodge a complaint early to reduce the risk of being excluded by future time limits. Additionally, a logged complaint could be valuable if legal action becomes necessary.


To log your claim or for further information, call us today at 01200 428102. Stay informed about updates from the FCA regarding the progress of their investigation and any potential redress schemes.


Make a PCP claim today contact us 7 days a week from 9.00 am – 10.00 pm including Bank Holidays on 01200 428102

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