The FSA is set to publish its rule changes on the approved persons regime this week, extending the rules to people providing advice or arranging mortgages. Although the FSA said its proposals have been ‘broadly supported’ by the market, some have called for the changes to be limited to intermediaries.
However, Lesley Titcomb, director of small firms and contact centre for the FSA, said that there was little point in taking a ‘half-hearted’ approach to extending the regime. The regulator must have oversight of the whole industry and the individuals who work in it in order to raise standards and combat fraud, she said.
Addressing the Council of Mortgage Lenders (CML) last week, Titcomb said: “Whatever we introduce for intermediaries, we must introduce for those people working for lenders who deal with customers as well. It would, after all, be naïve to think that fraud can only ever be an intermediary problem.”
Robert Sinclair, director of the Association of Mortgage Intermediaries, said: “Making sure both lenders and brokers are brought into the approved persons regime is certainly important. I also welcome the fact the FSA is doing individual work with lenders. We’ve seen brokers taken to task over this already, so it is only fair to extend it to lenders.”
Colin Snowdon, chief executive of residential mortgages for Aldermore, commented: “I think the issue of whether individual advisers should be approved persons is a question in its own right, but if the FSA go ahead on that basis, it is right to have a level playing field across branch advisers and intermediary advisers. I can’t see why it should be any different for one set of advisers over another.”
The CML said it was unable to comment until it had seen the FSA’s fully published rules.
The publication of rule changes next week will also cover arrears handling, although it is mainly a clarification of the rules set out in MCOB.
In addition, Titcomb said that the Treasury is carrying out further work on its proposals for securitisation, after respondents to the consultation highlighted unintended consequences for the funding markets. The revised proposals will be out later this year.
