Government intervention into car finance mis-selling rejected – here’s what’s happening

Below we explain what's happened. You can also see our Car finance reclaim tool and guide for full info on how to complain about mis-sold commission.

Supreme Court rejects Government attempt to intervene in landmark case

Consumer groups, trade associations, firms, individuals and Government bodies have had the opportunity to submit applications to offer their expertise and opinion – known as 'intervening' – to the Supreme Court on its landmark case regarding mis-sold car finance, which is due to be heard in April.

The Treasury's application was based on the "potential [for the case] to cause considerable economic harm", as well as on the potential impact on the "availability and cost of motor finance for consumers". But the Supreme Court has today (Tuesday 18 February) announced that it has rejected this offer to intervene.

Other key players in the debate, including Consumer Voice and the Finance and Leasing Association, have also had their requests to intervene rejected.

Though the Supreme Court has accepted interventions from the Financial Conduct Authority (FCA), which is currently investigating motor finance commission issues, as well as from the National Franchised Dealers Association.

You can still complain in the meantime

As it stands, all car finance commissions that aren't overtly declared break the law. And it may be that you're owed money and are able to submit a complaint to your car finance provider if you believe your commission arrangement wasn't properly explained to you.

You can do this by heading to our free car finance reclaim guide and tool, which talks you through the process step-by-step . The sooner your complaint is logged, the less chance there is that you'll be timed out.

Even though there's currently a pause on firms needing to deal with complaints, you can still log your complaint now. It just means firms can sit on it until things are decided, likely waiting until after the Supreme Court decision.

Car finance mis-selling – a brief timeline

• In January 2024, the FCA launched a huge investigation into car finance mis-selling, specifically looking at hidden discretionary commission arrangements (DCAs), which allowed brokers and dealers to choose from a range of interest rates, and to earn more commission if they charged a higher one.
  
  Since then, over 2.5 million complaints have been made via our free DCA tool. The outcome of the FCA's investigation in to DCAs was originally due to be announced on 25 September 2024, but this has since been pushed back to May 2025 to allow time for the Supreme Court's ruling on the commission disclosure case.

• In October 2024, a landmark Court of Appeal verdict then shook things up. It ruled that a car sales firm couldn't lawfully receive commission from a finance firm unless it had the customer's "fully informed consent", making payouts more likely. This meant anyone who'd had commission of any type on a car finance agreement could potentially be owed money back.
  
  But the car finance firms involved – Close Brothers and MotoNovo – have appealed this judgment to the Supreme Court. This hearing is the one expected to take place in April 2025, as outlined above.

• In December 2024, the FCA extended a pause on firms dealing with car finance complaints to all commission complaints – not just DCAs as was previously the case.
  
  This means car finance providers do not have to provide final responses to motor finance non-DCA commission complaints received on or after 26 October 2024 until after 4 December 2025.