'Confusion' over car finance compensation cleared

Motorists in the Channel Islands have been reminded they are not eligible for a car finance compensation scheme operating in the UK.

The Financial Conduct Authority launched a formal scheme in March for drivers who were mis-sold motor finance agreements, with the average payout expected to be about £829 per person.

However, the Channel Islands Financial Ombudsman (CIFO) said the scheme was unavailable in Guernsey and Jersey as it only applied to UK motor finance customers.

CIFO said it had issued the clarification after it noticed several articles which had caused "confusion" about what was available for islanders.

The organisation said it might be able to review concerns from customers who had a complaint about motor financing in the islands.

"Complaints about motor finance provided in the Channel Islands fall within the statutory remit of the Channel Islands Financial Ombudsman to review," CIFO added.

"Where we find a complaint has merit, we can award compensation for loss incurred up to a maximum of £150,000."

CIFO said people should first contact their loan provider, the car dealer who arranged the financing and/or the actual lender before bringing a complaint to the ombudsman.

A statement from CIFO added: "If you are unhappy with the outcome, or you do not receive a response within three months of raising your complaint with your dealer and/or lender, you can bring your complaint to CIFO for independent review."

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