UK's FCA proposes redress scheme for motor finance claims
"At this stage, we think it is unlikely that the cost of any scheme, including administrative costs would be materially lower than 9 billion pounds and it could be materially higher," the FCA said in a statement.
The United Kingdom's top court on Friday ruled car dealers who sold vehicles and arranged the finance did not owe fiduciary duties to customers, and lenders were therefore not liable for the commission.
The decision pushed up U.S.-listed shares of UK banks because it eased investors fears of a redress scheme that some analysts had warned could run into the tens of billions of pounds.
But on Sunday the FCA said that after considering the judgement, it was still proposing a scheme and would consult on what it should look like.
"Our consultation will cover how firms should assess whether the relationship between the lender and borrower was unfair for the purposes," the statement said.
"Any redress scheme must be fair to consumers who have lost out and ensure the integrity of the motor finance market, so it works well for future consumers."
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