In a blog post, the Financial Conduct Authority said it is launching a comprehensive review of the claims management market after seeing poor practices in motor finance claims, including unsolicited marketing, misleading adverts, unfair cancellation fees, weak consent and reports of fraudulent signatures. The review will assess how claims firms and law firms attract customers, how well they inform and support them, and whether pricing, funding models, financial resilience and differences in regulation are driving poor conduct. The work will initially focus on claims management services in financial services and on housing disrepair claims, which the FCA said should provide a broader view of business models and pricing incentives across the market. Since January 2024, more than 1,000 misleading car finance claims adverts have been removed or amended, three claims management companies have reduced unreasonable fees protecting over half a million people, four firms cannot currently take on new clients, and enforcement investigations are under way. A joint taskforce with the Solicitors Regulation Authority, the Information Commissioner's Office and the Advertising Standards Authority is also examining the poor handling of motor finance claims. Separately, the FCA said it is working with the Financial Ombudsman Service and the Government on a fairer, more proportionate and predictable redress system. It also said that, aside from motor finance, it has no other mass redress events on its radar.
Financial Conduct Authority2026-05-19
Financial Conduct Authority launches claims management market review after identifying poor practice in motor finance claims
The Financial Conduct Authority has launched a review of the claims management market, initially focusing on financial services and housing disrepair claims, following poor practices in motor finance claims and concerns over marketing, customer information, pricing, funding models and regulatory arbitrage. It has already amended or removed over 1,000 misleading car finance adverts, reduced unreasonable fees, restricted four firms from taking new clients and opened enforcement investigations, supported by a joint taskforce with the Solicitors Regulation Authority, Information Commissioner’s Office and Advertising Standards Authority. The FCA is also working with the Financial Ombudsman Service and the Government on a fairer, more proportionate and predictable redress system and says it has no other mass redress events on its radar beyond motor finance.