Car finance complaints reach record levels
The Financial Ombudsman Service has reported that car finance complaints have risen to record levels this year.
The spike has been driven by the ongoing commissions scandal, with FOS data revealing that vehicle hire purchases are the most complained about financial products.
It found that of the 68,000 complaints lodged with the FOS from December to February, 15,956 related to hire purchase agreements with the most common complaint being that customers were not told about commission payments to dealers.
This comes after a landmark ruling last November that found in favour of three customers who claimed they were mis-sold motor finance products. If the ruling is not overturned in the Supreme Court next month, lenders could face a combined bill of up to £30bn.
James Dipple-Johnstone, interim chief ombudsman of the Financial Ombudsman Service, said:
“We are continuing to see high volumes of motor finance commission cases and would encourage businesses to consider whether complaints are covered by the FCA’s temporary complaint handling rules. Ongoing legal proceedings are impacting our ability to issue final decisions in these cases, but we are putting steps in place to ensure we can resolve them as quickly as possible when we have the clarity we need.”
Meanwhile, FOS data found that credit cards and current accounts generated the second and third most complaints since December, with complaints about motor insurance (3,660) fourth on the list.
