The Treasury Committee has written to the FCA asking for an update on the consequences of the legal challenges to the motor finance commission redress scheme. The questions cover:
- consequences of the challenges – in particular, what the FCA is advising consumers to do, what it expects firms who would be covered by the scheme if it continues to do when they receive complaints, whether some complaints could continue to be processes, and whether the timetable for compensation will be affected by the challenge;
- administration – in terms of the costs to the FCA of what has been done so far and the additional costs of the legal challenge, including whether other workstreams have been delayed;
- alternate scenarios – seeking the FCA’s views on the impact on consumers and firms of the challenges resulting in changes to the scheme, and the likely effect on costs and other work at the FCA;
- conduct of market participants in terms of how lenders and claims management firms have engaged with the FCA and the effect of their conduct on consumers; and
- powers of the FCA – specifically what it has learned about its powers and how to use them, and what lessons Parliament might take from the case.
The letter asks for a response by 4 June, with updates as appropriate.