The concerns over advance commissions were raised in filings on behalf of the campaign group Consumer Voice, as part of its attempt to intervene in a pending supreme court case that will be key to determining compensation in the motor finance scandal.
Lady Bowles – who pushed the FCA’s chief executive, Nikhil Rathi, about the existence of advance commissions during a committee hearing last month – said: “This is surely a matter that should be the subject of more investigation and ruling somewhere, even if not explicitly in the supreme court case.”.
UK lenders paid “advance commissions” to car dealers that may have encouraged them to push costlier loans on to consumers, legal filings linked to the motor finance scandal reveal.
While Consumer Voice’s attempt to present its evidence at the supreme court hearing was rejected earlier this week – as was a controversial intervention in the case by the chancellor, Rachel Reeves – the group’s co-founder, Alex Neill, said the use of advance commissions was “cause for concern”.
An FLA spokesperson said: “We’re saying that if advance commission was a type of commission as alleged, then the FCA would recognise it as such, it would be included in its investigation and therefore covered by the supreme court case.”.
