FOS accused of misleading market over complaints
MI was told by an industry source that FOS is making it known a large number of mortgage complaints it is receiving relate to cases against brokers.
However, MI understands the majority of those complaints seen by FOS in fact relate to lenders, in particular to their high exit fees.
The source explained that the cases are initially going to FOS but lenders are resolving them before they go through the full complaints process.
He said at present the lenders are trying desperately to keep hold of their clients and do not want these complaints in the public domain so are resolving them quickly and feeding back to the market that the cases concern problems with brokers.
He added that FOS cannot report the complaints because they’re being withdrawn and resolved by the lenders.
Emma Parker, spokeswoman at the FOS, denied the accusation: “To get this into prospective FOS has had in the region of 500 mortgage-related complaints since regulation. We were given an estimate of between 300 to 1,000 so the actual figure is at the low end of the estimation and roughly 60 to 70 per cent of these complaints have been upheld in favour of the firm.
“ Broadly speaking the problems involving intermediaries have been administration-related. We have only seen a handful of complaints regarding lender’s fees so it’s difficult to comment on whether lenders are resolving complaints before they reach us.”
Chris Cummings, director of the Association of Mortgage Intermediaries, commented: “The FOS speaks at the majority of AMI’s conferences. Last week it made it clear mortgage brokers only account for a tiny fraction of the complaints. But lenders have been subjected to the Ombudsmen for longer so I’m not surprised if the majority of the complaints are to do with them.”