Money expert Martin Lewis has issued a warning over the finance scheme (Image: ITVX)
Money expert Martin Lewis has warned drivers “don’t get too excited” to claim your £829 car finance misselling compensation payment – because there will be scammers trying to take advantage. Returning on the latest episode of The Martin Lewis Money Show Live on ITV1 and ITVX on Thursday, Martin returned with a huge update on the car finance misselling scandal.
Since his most recent episode went out, the Financial Conduct Authority has announced the precise details of payments to drivers missold finance deals, which will mean average payouts of about £829 per driver per deal, on a total of 12.1M finance deals.
But Martin Lewis warned that on the back of the announcement, there will be vultures circling trying to cash in on the payouts by scamming people. Because drivers who have already logged a claim with the scheme are waiting to hear back about their compensation payouts, Martin warned that scammers posing as the official firms will try to hoodwink drivers.
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He told his ITV1 audience: “Now there is clearly something we need to worry about here. You hear I’ve said to people ‘you will be contacted’, whenever I say, ‘you will be contacted’, there are some nasty evil people out there who just have a light bulb that goes ‘opportunity’.
“So the most important thing at this point I need to tell you is this: beware scammers.
“Scammers are going to latch on and leech on the back of this. I’ve already been talking with the regulator about it, they are going to announce on Monday what they’re doing to prevent scammers and there’s quite a few things they can do.
“But most importantly for you, if you’re being contacted out of the blue, be very very careful unless you think it’s legit…”
Martin added: “But just don’t get too excited, make sure it’s real please.”
Compensation payouts are due on around 12.1 million unfair motor finance deals, at an average of £829 each, the financial watchdog has said as it unveiled the final plans for its redress scheme.
Motorists are expected to get a higher payout than the £700 estimated under previous proposals by the Financial Conduct Authority (FCA).
But the final scheme will mean around two million fewer deals are eligible for compensation.
The regulator is expecting the total amount of redress paid under its scheme to be about £7.5 billion, lower than the previous £8.2 billion estimate, and based on about 75% of eligible consumers making a claim.
It thinks millions of claims will be paid out this year, and the vast majority settled by the end of 2027.
FCA chief executive Nikhil Rathi said: “We’ve listened to feedback to make sure the scheme is fair for consumers and proportionate for firms. It will put £7.5 billion back into people’s pockets.
“Now we need everyone to get behind it and ensure millions get their money this year.
“Payouts should not be delayed any longer, especially as household bills come under greater pressure.”