Motor finance revs up City watchdog’s PR spend

Motor finance revs up City watchdog’s PR spend

June 23, 2026 discoverhiddenusacom Business

The Financial Conduct Authority (FCA) spent over £500,000 on external public relations agencies to manage communications regarding a motor finance mis-selling scandal, according to a Freedom of Information request by City AM. The expenditure focused on warning consumers about claims management firms as banks face billions in potential compensation.

The car mis-selling saga has dominated the regulator’s agenda since the start of 2024. It involves “secret” car deals that left consumers uninformed, putting City banks on the hook for billions in compensation.

The FCA pointed to this debacle—which has affected firms including Lloyds, Barclays, and Santander—as a primary driver for the increased spending. The watchdog maintains that these agencies help it deliver its strategy and help consumers navigate financial lives.

Did You Know? The FCA operates independently of the government and is funded through periodic fees on authorised firms and one-off levies on those applying for authorisation.

Why did the FCA increase its PR spending?

Spending spiked as the regulator fought to warn consumers about the risks of using claims management firms. In the fourth quarter of 2024, PR spend hit £180,000, nearly double the second-highest quarter of £98,000 in the third quarter of 2025.

Why did the FCA increase its PR spending?

The FCA launched a “communications offensive” against the “aggressive marketing” used by claims firms. In September, the regulator hired influencers for radio and online advertising to inform customers they do not need a claims firm to receive compensation.

How did court rulings impact car finance reviews?

A Court of Appeal ruling in October 2024 favored consumers in three landmark cases. This decision led the FCA to widen its scope to review all forms of car finance commissions.

Earlier, a Supreme Court ruling in August left the door open for an industry-wide redress scheme. This coincided with the second-largest spike in the regulator’s PR expenditure.

Expert Insight: Samantha Carter notes that the regulator’s decision to employ influencers suggests a strategic shift to meet consumers where they are. However, the backlash from both industry and consumers regarding the redress program indicates a significant tension between the FCA’s interpretation of the Supreme Court’s ruling and market expectations.

What other campaigns drove the regulator’s costs?

Beyond motor finance, the FCA funded the Investsmart project. This campaign warns retail investors against “pump-and-dump” and “get rich quick” scams.

Martin Lewis challenges FCA boss, why so little interest on Car Finance Mis-selling

The regulator also uses its PR budget to promote its firm checker tool, which allows consumers to verify if financial services firms are authorised.

What may happen next?

The FCA may face continued pressure from both the industry and consumers if disputes over the redress program’s interpretation of the Supreme Court ruling persist.

Further shifts in PR spending could occur if the regulator decides to expand its use of influencers or external agencies to combat other retail investment scams.

Frequently Asked Questions

How much did the FCA spend on external PR agencies?
According to a Freedom of Information request by City AM, the FCA spent over half a million pounds.

Which banks were specifically mentioned in the motor finance scandal?
The source identifies Lloyds, Barclays, and Santander as firms swept up in the debacle.

When did the Court of Appeal rule in favor of consumers?
The Court of Appeal issued its ruling in three landmark cases in October 2024.

Do you believe regulatory agencies should use influencers to communicate financial risks to the public?