🚗 The Motor Finance Supreme Court Case: How Lenders Have Admitted Breaching FCA Rules

The Supreme Court case has laid bare an uncomfortable truth about the motor finance industry: lenders acted in their own interests, with disregard for consumer fairness, and in doing so have effectively admitted to breaching the Financial Conduct Authority (FCA)’s rules.

What’s even more troubling is the FCA’s own position in court—aligned with the lenders—appears to sidestep or even contradict the very rules it is tasked with upholding.

⚖️ The Lenders’ Argument in the Supreme Court Case

In front of the UK Supreme Court, lenders have argued that:

• They were under no obligation to act in the best interests of consumers.
• They were not acting with impartiality, and were in fact only acting in their own commercial self-interests.
• The existence and amount of commission paid to car dealerships for arranging finance did not need to be disclosed, even when this incentivised the dealer to select more expensive or less suitable products.

This stance strikes at the heart of the regulatory rules that are designed to protect consumers from financial harm.

📜 The FCA Rules on Commission Disclosure

The FCA rules specifically state that a credit broker (the dealership) must disclose the existence and nature of commission arrangements if the commission could affect the broker’s impartiality.

The rule could not be more clear.

🔍 What is “Impartiality”?

Oxford Dictionary definition: “Equal treatment of all rivals or disputants; fairness.”

In the context of motor finance, dealerships were incentivised, by way of commission, to propose more expensive finance agreements to consumers.

Therefore, the mere existence of a commission affects the impartiality of the dealership—and thus, per FCA rules, should have been disclosed.

🚫 The FCA’s Position in Court: A Dangerous Contradiction

Rather than standing up for its own rulebook, the FCA has inexplicably chosen to side with lenders in this Supreme Court battle. By suggesting that:

• Lenders were not required to act impartially,
• Lenders were not required to act in the best interest of the consumer,
• Consumer harm is not a clear outcome of undisclosed commissions,

The position of the FCA undermines its own consumer protection framework and clearly contradicts its own rulebook.

📌 The Obvious and Clear Conflict

The FCA’s own rulebook requires disclosure where impartiality is affected.

The lenders’ argument in the Supreme Court case relies on the position that they were acting in their own interests, and not impartially.

There is either a fundamental misunderstanding by the FCA of its own rules, or a calculated retreat in favour of those it regulates.

🧾 What This Means: A Regulatory and Moral Failure

This case exposes a deep failure of industry governance. It confirms:

• Lenders knowingly structured commissions to benefit themselves and dealerships at the direct expense of consumers.
• Disclosure obligations were ignored despite impartiality being affected—and now effectively admitted.
• The FCA has, by its courtroom stance, given a green light to opacity and conflict of interest.

🔚 Conclusion: An Industry on Trial, and a Regulator on the Ropes

The Supreme Court case is not just about consumer refunds—it’s about systemic misconduct, regulatory weakness, and the fundamental question of who the financial system is designed to protect.

If lenders can argue they owe consumers no duty of care—and if the regulator tasked with enforcing fairness supports that argument—then the motor finance industry is more broken than anyone feared.

This is not just a case about past failings. It’s a live test of whether fairness and transparency have any meaning left in UK financial regulation.

YOUR MONEY CLAIM