EXCLUSIVE: Brokers display anger over FSA rules on financial promotions
Brokers said they had little faith in the FSA’s guidlines on what constitutes fair, clear and not misleading adverts.
One broker said: “Under the FSA’s rules the APR must be stipulated. But the APR is a discredited vehicle, and for someone who’s on a two or three-year deal the APR could be misleading.
“Also, we are told we have to put in our promotions the fees we charge. But this is pre-judging that you are going to charge a fee. How do we know if we will be charging a fee? You may decide not to charge anything. And we can’t put down our typical charges as this would be deemed as misleading.”
The FSA responded by saying that at the moment the APR is the best indicator the market has to determine the overall cost of the credit. It added that if brokers do not know the fees they will charge clients, then they should put down a representative fee. It said: “There is some leeway given in these circumstances.”