Financial Conduct Authority (FCA) Chief Executive Accused of Threatening Consumer Voice Over £9.1 bn Car-Loan Redress Scheme

Legal filings reviewed by the Guardian allege that FCA chief executive Nikhil Rathi told the directors of Consumer Voice (CV) on a Microsoft Teams call on April 27 that the regulator would face “adverse consequences” if CV pursued a legal challenge to the FCA’s £9.1 billion compensation scheme for mis-sold car loans.

The Guardian

The scheme is intended to compensate drivers who were overcharged when lenders paid commissions to car dealerships between 2007 and 2024. Consumer Voice argues the plan undervalues claims, offering an average payout of £830 per mis-sold loan, and says it favours the interests of profit-making lenders such as Volkswagen Financial Services, Mercedes-Benz Financial Services, and Crédit Agricole Auto Finance. The FCA maintains the scheme is the most efficient way to deliver compensation to millions of victims by the upcoming Christmas period.

The Guardian

Consumer Voice countered that the FCA’s conduct represents a shift from its prior treatment of the group as a “trusted expert consumer body.” The organisation’s co-founder Alex Neill said:

The Guardian

“We remain resolute and confident in our challenge on behalf of millions of consumers who are being short-changed by the redress scheme.” — Alex Neill, consumer voice co-founder

The Guardian

Consumer Voice and the three specialist lenders have lodged separate challenges to the FCA’s redress plan, citing different legal grounds. The FCA has continued to engage with CV and its legal adviser Courmacs Legal, noting that Courmacs provides pro-bono services in the case. Both parties have indicated they will respond fully in forthcoming court filings.

The Guardian