FCA confirms extension of complaint handling pause for motor finance DCAs
On 24 September 2024, the Financial Conduct Authority ( FCA ) published a Policy Statement, PS24/11 , confirming that it is extending...
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Our dedicated and experienced team investigates, represents, negotiates and then settles claims on behalf of clients. We currently focus specifically on issues surrounding the mis-selling of PCP claims which has enabled us to develop a deep understanding and expertise in representing clients with these claims.
Claim-Smart Limited
is a firm of financial mis-selling specialists, focused on helping clients with potential compensation claims against leading financial services providers.
PCP Motor Vehicle Finance
Secret Undisclosed Commissions Paid
Between 2007 and 2021 the way Motor Dealers and Brokers dealt with Consumers was relatively simple and open to widespread abuse:
When a consumer purchased either a new or used car from a Motor Dealer they would invariably be asked if they wanted financing using a Personal Contract Purchase (PCP). In the event the buyer said “yes” the broker or car dealer would introduce the consumer to a lender. At the same time the Broker or Motor Dealer would inform the consumer of the interest rate that the lender would charge them.
Crucially both the Lender and Broker or Motor Dealer failed to disclose to the consumer:
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That the interest rate they were being charged was actually being determined by the broker or car dealer itself.
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That the interest rate they were being quoted was often times significantly higher than the interest rate they would pay if they were to contact the lender directly (without going through the Broker or Motor Dealer)
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That the difference between the rate the broker or car dealer was quoting and the rate that could be obtained if the consumer had gone directly to the lender was being paid as a commission to the Broker or Motor Dealer.
In essence the difference between the interest rate a consumer obtained if they were introduced by a broker or car dealer, and that if they went directly to the lender was being kept by the broker or car dealer, as a commission is what is being referred to by the Financial Conduct Authority (FCA) as a Difference in Charges (DIC)
The Motor Dealer was effectively able to set an interest rate as high as they wanted to based on what they thought the consumer could afford and pocket the difference without telling the buyer.
PCP Claims
If a borrower of a loan believes that their Personal Contract Purchase (PCP) may have been subject to a Difference in Charges (DIC) claim they may be owed £1,000s in compensation.
Principal reason for making a claim from a lender
One of the main reasons you may be entitled to redress is that the lender did not fully disclose to you the details of the commission they were paying the person who sold you the car, or the dealer/broker who introduced you to the lender.
You were not informed that you could have saved a lot of money by taking out the loan if you simply went directly to the lender
Other reasons you may have a claim against a lender:
You felt pressured at the time into buying a product or committing to a service
The bank, broker or lender failed to advise you of the financial risks
You were promised something that was not delivered
The bank, broker or lender did not fully disclose details of all applicable charges
What can you do if you were a buyer and potentially affected:
You can use Claim-Smart Limited to act on your behalf to determine if you are owed anything, for which we will charge you a no-win / no-fee according to the FCA’s guidelines. We currently charge up to 36% (including VAT) of the amount, if any, you receive from the lender.
However, it is important to note that you do not need to use us or anyone else, to make your claim or complaint to your lender. You can do this yourself for free. If your claim or complaint is not successful on the first instance you can refer it to the financial ombudsman service yourself, again for free.
However you choose to make a claim you should be aware that the FCA is currently reviewing the process, so lenders do not have to make any payments until after the FCA has completed its review. This is currently scheduled to be completed on the 5th December 2025 so we believe payments, if any, from lenders will not start until several weeks after that date.
Our Services
With Claim-Smart Limited you can expect:
No-Win
No-Fee
We believe in working on behalf of our clients with full commitment, which is why we operate on a no-win, no-fee basis. There are no upfront costs for you to pay, ensuring that our services are accessible to all who require them.
Expert
Guidance
Our experienced team specialises in navigating the intricacies of mis-sold PCP finance agreements, providing you with the expertise needed to secure the compensation you are entitled to.
Personalised
Support
We prioritise clear communication and personalised support, and strive to keep you informed at every stage of the claims process.
Cutting-Edge
Technology
As a forward-thinking company, we are dedicated to embracing the latest advancements in technology to streamline and enhance our claims management process. By staying ahead of the curve, we offer you a seamless and efficient experience.
Efficient
Resolution:
Our goal is to achieve a swift and favourable outcome for your claim, allowing you to move forward with confidence and peace of mind.
At Smart-Claim Limited we combine innovation with experience to deliver results that matter. Please click on the “Make Your Claim” link below and let us guide you towards a successful resolution for your mis-sold PCP finance agreement.
About Us
Welcome to Claim-Smart Limited, your dedicated partner in seeking compensation for mis- sold PCP finance agreements.
At Claim-Smart Limited, we are committed to providing clear communication and expert handling of your claim from inception to resolution. Our primary goal is to secure you the compensation you are owed in the shortest possible time frame.
With a particular focus on the mis-selling of PCP claims, our team has both extensive experience and in-depth knowledge that sets us apart in the market. Our expertise allows us to navigate the complexities of your claim with ease, guaranteeing a high level of proficiency in securing the compensation you are owed.
Our Fees
How our fee works for non-litigious claims
Claim-Smart Limited complies with the Fee Cap rules and regulations of the Financial Conduct Authority (FCA), which protects consumers from excessive fees for non-litigious claims.
The new rules limit the fees that can be charged for non-litigious claims. These rules apply to claims where a claimant is awarded monetary compensation from a financial services firm, either directly from the firm, through the Financial Ombudsman Service, or from the Financial Services Compensation Scheme.
Under these new rules, the maximum fee that we can charge depends on how much compensation you receive. The fee is calculated as a percentage of your compensation, and it varies according to different bands of compensation amounts.
Frequently Asked Questions
Here are a few answers to some of the questions you may have if you are considering lodging a claim due to mis-sold PCP car finance:
For how long was motor finance mis-sold using discretionary commission arrangements?
The Financial Conduct Authority (FCA) banned the use of discretionary commission models by motor finance lenders in January 2021. Motor finance lenders started to use this method of commission to Brokers and Motor Dealers as far back as 2007.
So how far does this go back?
Anyone could potentially claim compensation if they purchased a motor vehicle through PCP motor finance before 28th January 2021 and as far back as 6th April 2007. This is when the Financial Ombudsman Service (FOS) took over jurisdiction of motor finance complaints.
How do you know if you were mis-sold motor finance?
The best way is to first review the finance agreements you signed with a lender to see if you had a PCP agreement. You would them need to get in touch with the lender, either directly or through a representative like us, to ask them whether they had a Discretionary Interest Commission (DIC) also sometimes referred to as a Discretionary Commission Arrangement (DCA) with your broker or car dealer, in place.
Is it only related to a new motor car?
No, Discount in Commission (DIC) arrangements were in place for a wide range of new AND used motor vehicles including cars, motorbikes, vans or trucks for personal use only including commuting.
Was every PCP motor finance agreement mis-sold?
The FCA estimates 95 per cent of car finance deals had a commission model, and 40 per cent involved a crucial “discretionary commission arrangements” (DCA).
How much compensation could I receive if I was mis-sold?
The amount you could receive will depend on your original motor finance agreement. The FCA reported that on average a consumer who’s motor finance included DCA paid £1,100 more in interest than they would have done had the consumer taken a loan out directly with the lender. In addition, the FCA has indicated that you may be entitled to receive an additional 8% in interest payments per year on top of your claim.
How long does a complaint or claim take?
Each case is slightly different so time scales may vary. Depending on the path your complaint or claim follows, an outcome could be determined in as little as 10 weeks or as long as 18 months. The time starts from the end of the FCA Pause.
What is the FCA Pause and how could this impact my complaint or claim?
The FCA has suspended the 8-week deadline for motor finance providers to respond to a complaint or claim, the Pause. This is scheduled to end on 5th December 2025 when it is expected to report on its findings, however, the FCA, may at its discretion, change that date.
Can I claim for a deceased relative?
It may be possible to claim on behalf of someone who has died, though the motor lender may want to see a copy of the will and grant of probate to ensure any compensation goes to the correct person.
Do I need to use a third-party to represent me?
No, you can represent yourself to investigate and bring forward a complaint or claim directly with the motor finance lender.
Registered Office: Claim-Smart Limited Berkeley Square House, Berkeley Square, London W1J 6BD
Telephone: 020 3307 5218
Opening Hours: Mon-Fri (9AM-6PM) - Applications can be made online anytime
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