FCA Urges Claims Managers, Lenders To Defuse Tensions

Law360, London (March 31, 2021, 4:51 PM BST) -- Britain's financial watchdog called on claims management companies and high-cost lenders on Wednesday to improve their working relationships, expressing fears that a fallout could harm consumers.

Tensions between the sectors have been caused by problems such as claims management businesses approaching a lender about a loan on behalf of a customer when in fact the loan does not exist, the Financial Conduct Authority said.

Some high-cost lenders are not willing to disclose data in an efficient way to claims companies, known as CMCs, that are exploring whether they can seek redress for a customer, the regulator said. High-cost lenders, such as payday loan...

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