Martin Lewis has urged motorists not to sign up to a claims firm after the Supreme Court overturned a decision on the car finance commission scandal. Consumers previously alleged that commissions paid to car dealers were bribes and that dealers owed a duty of loyalty to the customer. One of these cases was upheld, but two others were rejected, meaning they cannot get compensation.

In response, the Money Saving Expert warned people not to act rashly, as he suggested there could be a further consultation on the issue of compensation. He wrote on X: “CAR FINANCE DO NOT DO ANYTHING NOW. DO NOT SIGN UP TO A CLAIMS FIRM. PLEASE SHARE. My suspicion is the FCA will within weeks announce consultation on a redress scheme for discretionary commission cases.

“You may not even have to claim it, could be automatic. And with excessive commissions I suspect more guidance will come on that at a similar time.

“If you sign up to a claims firm now, you may have to give it a cut even if it does nothing. So just sit on your hands for now.”

The Supreme Court’s ruling means that lenders won’t have to pay compensation to millions of motorists over car finance loans.

As Mr Lewis suggested, the Financial Conduct Authority (FCA) is considering a more limited compensation scheme. The regulator previously said it would launch a scheme within six weeks of the Supreme Court judgment.

It could announce a central compensation scheme for people whose loan agreement had a “discretionary commission arrangement”, which has now been banned.

Nearly anyone who bought a car with finance could be owed compensation as, in the UK, roughly 80-90% of new cars are bought with loands. It could cost lenders such as Santander UK, Close Brothers, Barclays, and Lloyds up to £44 billion.

A Treasury spokesperson said: “We respect this judgment from the Supreme Court and we will now work with regulators and industry to understand the impact for both firms and consumers.

“We recognise the issues this court case has highlighted. That is why we are already taking forward significant changes to the Financial Ombudsman Service and the Consumer Credit Act.

“These reforms will deliver a more consistent and predictable regulatory environment for businesses and consumers, while ensuring that products are sold to customers fairly and clearly.”