FCA Issues A Scam Warning When Taking Car Finance

Friday, 22. April 2016

The Financial Conduct Authority (FCA) has issued warnings about a number of scams that are doing the rounds perpetrated by brokers who are not authorised by the FCA.

They will be looking to take action against such companies when they are found but in the meantime the onus is on consumers to make sure they check that the person providing the finance/advice/services is properly authorised.

Especially the case when you are asked to part with money upfront as a commitment fee or a deposit to secure a car that will be financed. Their advice is ‘We strongly advise you to only deal with financial firms that are authorised by us, and check the Financial Services Register to ensure they are.’

And here’s the rub, if you give money to an unauthorised firm, you will not be covered by the Financial Ombudsman Service (FOS) or the Financial Services Compensation Scheme. So as I pointed out recently the first consideration should not be the rate that you are offered, be that a lease rate or APR, but the company that offers it and will represent you going forward. You have been warned – yet again! By Graham Hill

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