FSA confirms further review into non-conforming
Speaking to Mortgage Introducer, FSA spokesperson Robin Gordon-Walker explained it had started a further review of compliance by small mortgage brokers with requirements on selling and advising in the non-conforming market.
The move comes after the FSA revealed both good and bad practices in the non-conforming market in September 2005. The initial review reported, overall, there were too many cases where firms were unable to show they had followed the required procedures relating to suitability when advising on these mortgage contracts.
Gordon-Walker said: “We are very much looking at the same areas as the initial review. We will of course be revisiting the firms we found with shortcomings to make sure these areas have been rectified. As well as visiting or being in contact with some of the original 31 small firms it will be an industry-wide review. We want to see a distinct improvement and will work with firms to make sure this happens.”
Speaking regarding the initial review Andy Watson, head of mortgages and credit union department at the FSA, said: “It’s difficult to establish the level of consumer detriment or potential mis-selling as many of the failings related to poor record-keeping and brokers could provide more detail when challenged, but we will be looking for better evidence of compliance with our requirements in future.”