Drivers should have been offered impartial support when buying a vehicle through car finance, an MP has told GB News, as motorists wait anxiously for an update on compensation.
The Financial Conduct Authority (FCA) has been investigating a high number of complaints relating to "secret" commission payments, known as discretionary commission arrangements (DCAs).
The UK's Supreme Court is expected to hand down a verdict in July regarding a mis-selling scheme for motor finance offers issued between 2007 and 2021.
More than one million drivers could be impacted by the scandal and could request compensation, with the FCA potentially introducing a redress compensation scheme to determine who has suffered harm.
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Drivers are still awaiting the outcome of the car finance scandal, with the Supreme Court expected to deliver an update next month
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It must assess who has suffered harm, and how it will impact the motor finance industry as a whole, which the FCA acknowledged earlier this month.
Several high-profile firms have already set aside hundreds of millions of pounds in preparation for a potential redress scheme involving compensation.
Early suggestions had stated that the car finance redress scheme could be on the scale of the PPI scandal, although these estimates have since been watered down to single-billion-pound totals.
Speaking to GB News, Bobby Dean MP, noted that there could be a wide range of outcomes from the Supreme Court, with a statement expected in July.
Bobby Dean, Liberal Democrat for Carshalton and Wallington, quizzed the bosses of major lenders on the car finance scandal PARLIAMENT.TVMany drivers and industry experts will be hoping for a redress scheme which would allow them to receive compensation for being "duped".
The Liberal Democrat MP for Carshalton and Wallington previously grilled Charlie Nunn, CEO of Lloyds Banking Group, accusing the bank and others of "hiding behind a legal definition of harm".
Nunn rejected these claims, saying that brokers were acting in the interests of the lender, and that in normal cases, brokers focus on additional extras, like paint protection.
Dean said: "When you get finance, you require impartial advice to get the finance element. When the dealer is presenting to be the honest broker and they're not, when they've already stitched up the deal behind closed doors, that is the problem.
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"There are too many people who think 'that's all part of buying a car, if you got ripped off, you got ripped off, that's on you'.
"But it's the finance element that distinct because it's complicated and because you need advice, and that needs to be impartial, that's the bit that's gone wrong here."
He highlighted that buying a car is likely the biggest purchase someone will make, alongside buying a house, and that truly impartial advice is needed to ensure they make the best decision.
There are many factors that could potentially impact the redress scheme, including the average payout via a financial ombudsman or claims court.
Martin Lewis said he expected the Supreme Court to deliver a verdict on the car finance scandal in July
PASimilarly, it could look at the total value of the loan, the DCA value or even the ordinary market value of the car finance scheme without the additional Commission Disclosure complaints.
Consumer finance expert Martin Lewis stated that the most likely outcome would be for the Supreme Court to overturn the Court of Appeal ruling.
In this event, the FCA would only set up a redress scheme for the DCA complaints, which he claimed would likely be "in the billions to low £10s billions".
The FCA said it would deliver its verdict six weeks after the Supreme Court's decision, which is expected in July. It warned that it could also launch another consultation on any changes that arise in the meantime.
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