Vehicle finance discretionary commission complaints – information for customers

 At this stage, we can’t comment on any potential compensation customers may be entitled to. What we do know is on 11 January 2024, the FCA announced that they’re going to undertake work in the motor finance market.  

This is due to the high number of complaints coming from customers regarding discretionary commission arrangements (DCAs) which existed prior to changes introduced by the FCA in 2021.  

This work is market-wide and affects all providers of vehicle finance.  

You can find out more about the FCA’s work on their website, which is https://www.fca.org.uk/consumers/car-finance-complaints

Normally, we must provide a response to your complaint within eight weeks, or let you know that we need longer.

The FCA paused the requirement to respond to discretionary commission arrangement complaints while they undertake their review and decide what action, if any, will be required by firms for these complaints. 

The pause is currently due to end 4 December 2025.

If you submit a relevant complaint, you’ll have to wait until after the pause has ended for a final response. The FCA has taken this step to ensure complaints are dealt with consistently by all motor finance providers. 

This pause is limited to only discretionary commission arrangement complaints. There are no changes to the timescales in place for all other complaints. 

We’re sorry for the delay. We’re currently dealing with a high volume of enquiries about discretionary commission arrangements, and we’re checking each case thoroughly. It may take us longer than usual to respond to some customers.

If you received your final response letter between 12 July 2023 and 10 January 2024, you now have the right to refer your complaint to the Financial Ombudsman Service (FOS), free of charge up until 29 July 2026. This is an extension to the usual six months which the FCA have introduced to allow them time to complete their review into the historical use of discretionary commission arrangements in the motor finance industry.

For information on the service the Ombudsman provides can be found here.

Our automated process for matching and verifying the identity of our customers compares the information you submit against data held in our systems at the point your agreement ended.  If the information you provide doesn’t match our records, we won’t be able to find your agreement.

Common reasons for this include:

• If you’ve moved house and the address provided is not the same address we held at the time your agreement ended.
• If the complaint is not brought by a customer named on the account, for example on behalf of a relative.
• If your agreement was taken out more than six years ago, we’re far more likely to find it if you provide the agreement number.
• If you’ve changed your name and it’s not the same as what we had recorded at the time your agreement ended.
• If the agreement you had was with another part of Close Brothers, and unrelated to motor finance. For example, Close Brothers Premium Finance fund vehicle insurance policies.

To be able to confidently match your complaint with a historical finance agreement we need the following information:

• Agreement number OR vehicle registration
• Date of birth
• Full name (as at the end of your agreement)
• Address and postcode (as at the end of your agreement)
   

The pause is currently due to end 4 December 2025., this is to give the FCA enough time to analyse the data they’re collecting from vehicle finance lenders and to assess the outcome of a judicial review of the Financial Ombudsman’s decision to uphold a discretionary commission arrangement complaint. The FCA’s next steps could involve consulting on a customer compensation scheme which will take time to plan for and carry out.