The solicitor who won the case to clear the way for £9.1 billion in compensation for UK drivers has accused the Financial Conduct Authority (FCA) of “hypocrisy”.
Kevin Durkin is the only lawyer in the UK to successfully take a car finance case to the Supreme Court and win. He led the landmark case brought by Marcus Johnson against FirstRand Bank, securing legal precedents that have significantly strengthened consumer rights.
As a legal challenge to the scheme was launched by Consumer Voice, the FCA has said: “It seems contradictory that organisations claiming to represent consumers would seek to delay payouts for millions of people.”
Mr Durkin, Head of Legal Practice at HD Law, accused the FCA of hypocrisy for their reaction.
He said: “It sits ill in the mouth of the FCA to reference delay when it has been investigating this area for almost ten years before setting down a clear policy only last month. This in itself was accelerated by HD Law succeeding on behalf of Mr Johnson in the Supreme Court last August.”
Mr Durkin has consistently argued that the regulator has been systematically “lowballing” compensation to protect bank liquidity.
He said: “I welcome this challenge to the Financial Conduct Authority’s flawed motor finance compensation scheme. The concerns being raised reflect obvious issues with the scheme, which, in its current form, leaves many consumers under compensated.
“Given the paucity and inadequacy of the scheme, HD Law is not surprised it is being challenged. It is right that these matters are now being tested.
“HD Law has played the leading role in advancing consumer rights in this area, including securing victories in the Supreme Court and Court of Appeal, which have helped establish important legal principles for consumers.
“The current scheme simply does not have the general public’s needs at the forefront. While a judicial review may result in a short-term delay, we hope it can deliver a fairer, more equitable outcome for consumers overall. Let’s hope that any potential delay results in more money in the public’s pockets. Short-term pain for long-term gain.
“If the challenge succeeds, it could ensure that affected individuals receive the compensation they deserve, reinforcing trust in the process. Let’s just hope that this is expedited swiftly.”
Media Explainer Motor Finance Judicial Review
What is happening?
Consumer Voice is preparing a legal challenge against the Financial Conduct Authority over its £9.1bn motor finance compensation scheme.
Why is the scheme being challenged?
Critics argue that:
- The scheme places too much emphasis on limiting the financial impact on lenders
- Compensation levels are too low (around £830 per agreement on average)
- Key elements, such as interest and eligibility, have been restricted in a way that reduces payouts to consumers
- As a result, millions of drivers risk being undercompensated.
What does the regulator say?
The FCA maintains that the scheme is the “quickest, fairest way” to compensate consumers and has warned that legal action could delay payments to millions of people.
What happens next?
- A formal judicial review could be filed imminently, with a deadline of 27 April 2026
- If accepted by the court, it may delay the rollout of compensation
- The case is likely to be expedited due to its scale and public importance
What is the potential impact?
- Short term: Consumers may face delays in receiving payouts
- Long term: If the challenge succeeds, compensation levels could increase significantly