The Financial Ombudsman Service (FOS) has recently provided an important update on car finance commission complaints, highlighting the current state of play and their ongoing efforts to address consumer concerns. With around 20,000 open complaints related to car finance commission, the FOS is committed to ensuring fair outcomes for all parties involved. Here’s a comprehensive look at the key points from their recent announcement.

Background on the Issue

Car finance commission complaints have been a significant focus for the FOS, especially concerning the transparency and fairness of commission arrangements. Many consumers have raised concerns that they were charged excessive amounts for their car finance due to undisclosed or half-disclosed commission practices.

Key Points from the FOS Update

  1. Publication of Representative Final Decisions:

    • In January 2024, the FOS published its first representative final decisions addressing a range of motor finance complaints. These decisions aim to set a clear precedent and guide both consumers and financial firms on how similar complaints should be handled in the future.
  2. Ongoing Legal Proceedings:

    • The update acknowledges that ongoing legal proceedings around motor finance commission have impacted the FOS’s ability to issue final decisions in some cases. Specifically, three court cases related to car finance commission have been granted permission to go to the Court of Appeal, which will consider how the law relating to secret and half-disclosed commission might apply.
    • Additionally, Clydesdale Financial Services Limited, trading as Barclays Partner Finance, has initiated judicial review proceedings concerning one of the FOS’s decisions. The outcomes of these legal proceedings could significantly influence the FOS’s approach to handling similar complaints.
  3. Commitment to Progress Complaints:

    • Despite the complexities introduced by legal proceedings, the FOS is determined to progress consumers’ complaints as much as possible. They encourage firms to continue investigating and responding to complaints promptly.
    • The FOS aims to have all necessary information ready to decide complaints as soon as it is appropriate to do so. They will continue to accept and investigate complaints to ensure they can issue investigator provisional assessments and ombudsman final decisions where appropriate.
  4. Resources for Customers and Businesses:

    • The FOS has published detailed information for customers who wish to make a complaint about car finance commission. This includes explanations of the investigation process and guidance on what to expect.
    • Financial businesses responding to complaints can also access resources that outline the FOS’s current approach to these cases, the application of the FCA’s guidance, and the information required for complaint handling.

Implications for Consumers

For consumers, the FOS update underscores the importance of understanding your rights and the processes involved in making a car finance commission complaint. If you believe you have been overcharged due to undisclosed or half-disclosed commission practices, it is crucial to:

  1. Gather Evidence: Collect all relevant documentation, including finance agreements, payment records, and any correspondence with the finance provider.
  2. Submit a Complaint: Follow the FOS’s guidelines to submit a complaint, ensuring you provide detailed information and supporting evidence.
  3. Stay Informed: Keep updated on the progress of your complaint and any developments in the ongoing legal proceedings that might affect your case.

Next Steps for Financial Firms

Financial firms are encouraged to:

  1. Review Practices: Assess and review their commission arrangements to ensure they comply with current regulations and standards of transparency.
  2. Respond Promptly: Continue to investigate and respond to complaints in a timely manner, adhering to the guidance provided by the FOS and FCA.
  3. Prepare for Outcomes: Stay informed about the ongoing legal proceedings and be prepared to adjust practices and complaint handling processes based on the outcomes.


The Financial Ombudsman Service’s update on car finance commission complaints highlights the ongoing efforts to address consumer concerns and the complexities introduced by current legal proceedings. Both consumers and financial firms are encouraged to stay informed and proactive in addressing these issues. By maintaining transparency and compliance, the industry can work towards fair and satisfactory resolutions for all parties involved.

For more detailed information and resources, visit the FOS’s official page on car finance commission complaints.

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