Sinclair, speaking at the Tenet conference in London, said that the Mortgage Market Review had been the ideal opportunity to introduce such measures but the regulator had let the industry down.
He said the FSA had told him it was unable to implement such a scheme because of IT problems associated with the change to the FCA.
“The failure of the regulator to step up to the plate and deliver on this is the ultimate disgrace in terms of the review. They asked for our views, we gave them our views and then they said they couldn’t deliver because they have IT problems.
“Any regulated business which told the regulator they had IT problems would get short shrift. The fact they can say that while taking in fees is fundamentally wrong.”
He said that trade bodies would now engage in discussion to try and implement individual registration, but that questions remained over this.
“They’re asking us to solve their problem for them. A working group including the AMI board, the CML (Council of Mortgage Lenders), IMLA (Intermediary Mortgage Lenders Association) and the BSA (Building Societies Association) to see if the industry can come up with a solution.
“This is a big piece of work and it will take us 12-18 months to get there, but I think the industry is committed to a register. One that includes both brokers and direct selling staff.”
Tenet Lime’s managing director Gemma Harle later told Mortgage Solutions that the regulator was making a mistake in waiting until after the implementation of the MMR
“The FSA says it doesn’t have the right IT system in place to individually register mortgage advisers, but the regulator is already authorising IFAs.
“Its excuse is that this system has glitches, which makes it more stupid to start again from scratch instead of correcting and building on the mistakes made by the old system.
“The move to the tripartite system is no excuse for kicking this into the long grass with no timeframe in place. We can’t make those sorts of excuses to the regulator when we have obligations to fulfill,” said Harle.
Sinclair also told the conference that interest-only mortgages would continue to be scarce, but not because of pressure from the regulator.
“Interest-only looks to be in a position where it is too difficult for lenders, but that’s not from a conduct or MMR perspective. It is much more about the cost of money and liquidity than it is about the rules.
“What the FSA has done is say interest-only is okay, but what they were previously concerned about was the amount being done, at 40-50% of lender’s books. It looked like it was being done to make houses affordable in the short-term but not necessarily repayable in the long-term,” said Sinclair.
He added that the FSA is looking for interest-only to be around 10% of total business, reaching 20% in London.
In a wide-ranging speech, Sinclair later said he expected lending to reach £156bn in 2013, with intermediaries taking an increasing share of the market.
“Lenders want to do more lending but with the same level of resource by getting good business straight through the door and back out first time.”
