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The Liberal Democrat MP is urging the Government and financial regulators to establish a compensation scheme following a Supreme Court judgment that found some car finance commissions to be unfair.
The ruling has raised the possibility of payouts for consumers who were charged inflated interest rates through discretionary commission arrangements, where dealers could increase rates and receive higher commissions as a result.
Ms Collins said: “It’s absolutely vital that any consumer who was unfairly ripped off through eye-watering, unfair commission on car finance deals gets the compensation they are owed.
“Following the pivotal Supreme Court ruling last week, we Liberal Democrats are urging the Government and financial watchdog to work together to make this happen, and secure access to compensation without delay.
“We need to put an end to lenders getting away with this, and Liberal Democrats will keep holding the Government to account on doing so.”
On August 3, the Financial Conduct Authority (FCA) announced plans to begin consulting on a compensation scheme in early October.
The FCA said that if the scheme is approved, payments could start in 2026.
Lloyds Bank, the UK’s largest car finance lender, has already set aside £1.2 billion for potential claims.
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