Sheree Howard says campaign aims to inform, not deter, consumers seeking legal help
The (FCA) has rejected suggestions that its £1million advertising campaign on motor finance claims is designed to discourage consumers from using lawyers or claims management companies (CMCs), insisting that the initiative aims only to ensure consumers make informed choices.
Speaking at the Claims Futures conference last week, Sheree Howard, the FCA’s executive director of authorisations and interim joint chief operating officer, said the regulator’s messaging was intended to help people understand their options, not to dissuade them from seeking professional advice.
“Our campaign is designed to bring balance, fairness, transparency, and information,” she said. “It’s about helping consumers make properly informed decisions — particularly those who are vulnerable and most likely to be drawn in by some of the advertising we’ve seen on social media, or sign agreements without fully understanding them, only to be hit with unexpected cancellation fees.”
Embed from Getty Images
Howard added: “I really do want to stress this is not about preventing professional representatives from providing quality advice to their customers and acting in their best interests. We know the value a representative can bring when they act in the customer’s best interests.”
The FCA launched the campaign earlier this year to raise awareness among motorists affected by alleged overcharging in vehicle finance arrangements. It reminds consumers that they can make compensation claims directly to lenders or the Financial Ombudsman Service without representation, though they are free to instruct a solicitor or CMC if they wish.
However, the initiative has drawn criticism from parts of the consumer claims industry. Matthew Maxwell-Scott, executive director of the Association of Consumer Support Organisations, said it was “strange” for the FCA to spend public money “actively encouraging people not to use the organisations that they regulate.”
Howard responded that the regulator’s message was being misinterpreted. “It is not about stopping an industry that I’ve been very clear has exposed wrongdoing in the financial sector and is a key part of giving consumers access to justice,” she said. “Yes, we’ve spent a million pounds, but I’m sure that people in this room are spending many multiples of that to generate claims. We’re simply trying to bring balance to the market.”
She cited the FCA’s Financial Lives survey, which found that around 8% of adults in the UK had made a compensation claim, with a quarter of them using professional representatives. “A significant proportion said they wouldn’t have claimed without that help,” she said. “But at the same time, about 30% were dissatisfied with the service they received and felt the fees they paid were unfair.”
Since the FCA assumed regulation of CMCs in 2019, the number of active firms has declined steadily. Many have shifted from advice and case handling to lead generation. Howard said the regulator was closely monitoring emerging trends, including the rise in motor finance, housing disrepair, and employment-related claims.
She warned that tighter profit margins and the Ombudsman’s charging model were putting pressure on business models, but that firms still had to meet their regulatory duties. “CMCs and law firms play a critical role in helping consumers seek redress,” she said. “But with that role comes responsibility — to act with integrity, ensure claims are genuine, and deliver value, not just volume.”
Howard said the FCA would challenge firms charging excessive fees, including termination fees, and noted that some had already reduced prices after feedback from the regulator. She also emphasised the importance of compliance with advertising and data rules. “Our financial rules for CMCs are centred around promotional material being clear, fair, and not misleading,” she said. “Since January 2024, we’ve requested the removal or amendment of more than 700 financial promotions related to motor finance claims.”
Concluding her address, Howard said the regulator recognised the essential role of the claims sector. “We believe that a well-functioning claims management industry helps expose wrongdoing and poor practice. It’s a vital component of the financial services market.