Officials in the United Kingdom conducted multiple raids this week targeting companies accused of sending unsolicited marketing texts related to the car finance mis-selling compensation scheme. On Wednesday, the Information Commissioner’s Office (ICO) executed search warrants at homes and businesses associated with five companies in London, Liverpool, Bolton, Burnley, and Swansea, seizing electronic devices and documents as part of an ongoing investigation.
Since September 2025, more than 12 million complaints have been lodged with regulators about nuisance text messages from claims management companies (CMCs) and related firms marketing services tied to the car finance scandal. These companies are attempting to capitalize on billions of pounds in compensation set aside for motorists mis-sold car loans.
The mis-selling scandal involves drivers who were overcharged on loans due to commission deals between lenders and car dealers from 2007 to 2024. In March, the Financial Conduct Authority (FCA) announced a £7.5 billion industry-wide compensation scheme, expecting to distribute an average payout of £829 per eligible claimant this year. However, the scheme has been partially suspended following legal challenges, with a court ordering a pause until further hearings scheduled for December or February.
Andy Curry, head of investigations at the ICO, emphasized the public’s frustration with unsolicited contact regarding car finance claims and signaled the raids as a warning to the claims management sector to comply with legal standards. The companies involved in the searches are suspected of sending a combined total of around 170 million text messages to consumers between September 2025 and May 2026.
The ICO is collaborating with the FCA, the Advertising Standards Authority, and the Solicitors Regulation Authority to address abusive practices by some CMCs, law firms, and lead generation companies involved in motor finance claims. Since January 2024, these coordinated efforts have resulted in the removal or amendment of over 1,200 misleading advertisements. Some businesses are undergoing enforcement actions or have been compelled to reduce fees deemed "unreasonable" and allow consumers to exit contracts without penalty.
Under the Privacy and Electronic Communications Regulations, the ICO has authority to seek court warrants to search premises and seize evidence, including electronic devices and collections of mobile phone SIM cards known as “sim farms” used for mass text messaging.
The FCA has advised consumers that they do not need to use claims management companies or law firms to file complaints and encourages the use of a free template letter available on its website. To increase awareness, the FCA launched a nationwide advertising campaign this week, running across television, radio, print, billboards, and social media that will continue until September 6.