Consumer Voice: Car finance giants face legal claims of over £1bn for ripping off consumers

Around a million UK consumers could have unwittingly overpaid for car finance over a six year period.

Three collective action lawsuits have been filed at the specialist competition court accusing the three largest car financing companies, Lloyds Banking Group, MotoNovo and Santander, of acting to inflate interest rates.

This anti-competitive conduct meant UK consumers were paying too much – to the tune of £1bn. They claim that consumers were charged higher interest rates when buying used cars on finance due to anti-competitive agreements between providers of car finance and dealers.

Doug Taylor, an experienced consumer advocate who filed the claims, said:

‘We believe that Black Horse Ltd (Lloyds Banking Group), MotoNovo and Santander took advantage of their customers. Affected consumers unknowingly paid more for their car loans because of the way these companies incentivised dealers.”