The Consumers’ Association (CA) has expressed concern that ‘the man in the street’ may soon be introducing Future Mortgages’ second charge products to borrowers.
Financial giant Citigroup, owner of Future Mortgages, has re-branded its US retail financial services operation, Primerica, as Citisolutions and brought the operation to the UK. It began conducting business in the UK in April this year and is coming to the end of its pilot phase.
In the US Primerica introduces financial services to the public through a network of representatives who are in turn encouraged to increase their income by recruiting further representatives. The company offers customers a financial needs analysis, designed, as Primerica literature states, ‘to assist you in identifying your financial needs and goals so that you can make better informed decisions in managing your money.’
However, Primerica’s literature states that this is not a financial plan, and should be construed as a guide. Furthermore it states: ‘Representatives are not financial planners, investment advisers, financial consultants or other specialists who provide financial advice and whose compensation may be unrelated to sales.’
The CA is aware of Citisolutions and said it was ‘concerned.’ Teresa Fritz, spokeswoman for the CA said: ‘As far as we can tell they are selling critical illness, term assurance and debt consolidation products, all unregulated products. The CA has heard about unauthorised advisers selling products of this type and is concerned about this practice. We are looking into Citisolutions. Citigroup is a very reputable company and it is huge, so it strikes me as odd that they would do this.’
She added: ‘We would always recommend that the public buy from only qualified advisers, as we see no reason to do otherwise.’
Susan Tether, director of media relations at Citigroup, emphasised that Citisolutions representatives worked in an introductory capacity only. She said: ‘Citisolutions does not provide mortgage advice and is not conducting any unauthorised activity and has been, and will continue to be, compliant with all UK regulations.’
She added: ‘The core objective of Citisolutions Financial (UK) Limited is to help average income families improve their financial future. Citisolutions’ agents will introduce middle-income consumers to financial services and products designed for their needs, such as term life assurance, critical illness cover and mortgage loans.’