ISLANDERS who suspect they may have been mis-sold car finance are being encouraged to lodge official complaints with the help of the Jersey Consumer Council – which is anticipating the issue “could be quite significant across the Channel Islands”.
The JCC, which announced in November that it was investigating “the level of potential exposure for consumers in our jurisdiction”, has now created template letters that consumers can download, fill out and send to car dealers and finance providers.
It follows an industry-wide car scandal that has been the subject of UK Supreme Court proceedings, relating to the use of discretionary commission arrangements where the broker – often a car dealer – could adjust the interest rate being offered to obtain a higher commission.
An extensive review of motor finance agreements by the UK’s Financial Conduct Authority found “widespread failures to adequately disclose the existence and nature of commission and contractual ties between lenders and brokers” and that many consumers “may have overpaid” as a result.
JCC chair Carl Walker has previously stated that the organisation was looking into the potential implications for consumers in the Channel Islands, given the “structural and commercial similarities in the way vehicle finance is offered” and “the common practice of using UK-based finance companies and brokers”.
In an update yesterday, Mr Walker said: “In order for the Channel Islands Financial Ombudsman to consider his next steps, he needs Islanders to have first lodged an official complaint with either the finance firm, the car dealership, or both.
“We have put together the letter templates, which people can download, fill in the appropriate gaps and submit.”
Mr Walker added: “It is worth reminding consumers that this is going to be a long process, but these are the important first steps.
“From the initial reaction and feedback we’ve had, we are anticipating that this could be quite significant across the Channel Islands.”
