The £2m FCA adverts on TV, radio, billboards and social media direct potential claimants to a free template complaint letter on the FCA website. FCA executive director Sheree Howard said this would help people ‘get any money owed back without it costing them a penny’.
However, David Whitmore, chair of the Consumer Legal Association (CLA), a not-for-profit representing consumer law firms, insurers and the interests of claimants, said: ‘Claimants should know they can complain directly for free.
‘But the FCA has stated that “you don’t need to pay to claim” and that claimants may pay for “a service you don’t need”. Those statements risk presenting professional legal advice as unnecessary before someone understands their case. This is about choice, and claimants should decide whether they want help.
‘A claimant could be wrongly told they are not eligible, offered too little compensation or miss the deadline to challenge the lender’s decision. That risk is particularly concerning for claimants with low financial confidence, limited digital skills or other vulnerable circumstances.’
Whitmore also pointed to the fact the FCA scheme is currently partially suspended due to a legal challenge.
The FCA estimates 12.1 million motor finance agreements entered into between April 2007 and November 2024 are eligible for the scheme, with a potential £7.5bn compensation due. Under the FCA scheme, claimants can pursue their claim directly for free but may choose to seek independent legal advice.
In June, the FCA had 170 misleading car finance claims adverts removed or amended by claims management companies, bringing the total up to 1,200 since January 2024. The Advertising Standards Authority has also launched investigations into ads placed by law firms.
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