Regulator aims to nip Europe's potential AR mis-step in the bud
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The Financial Services Authority says it is working to ensure that the European Commission does not inadvertently prevent the appointed representative model from working in the UK as a result of the mortgage directive.
Keith Hale, technical specialist for mortgages at the FSA, made the warning at Mortgage Strategy’s Mortgage Masters conference in Buckinghamshire last week.
In a wide-ranging update on the European directive Hale told representatives of the mortgage industry that at the moment the directive is drafted in specific terms that would require each individual mortgage intermediary to be authorised.
He says: “We think that’s a drafting issue and a failure of understanding rather than a particular policy dislike that Europe has for the AR model.”
The FSA has already been able to introduce the concept of tied agents, which is European speak for appointed representatives, into both the Markets and Financial Instruments Directive and the Insurance Mediation Directive.
Hale adds: “We just want to make sure there isn’t a mis-step when the proposal is finalised.”
David Copland, managing director of Pink Home Loans, says that if the ruling was left in the mortgage directive, it would lead to a radical shake-up of the sector and would be difficult financially.
He says: “Certainly I would have thought that it would put pressure on mortgage networks’ commercial models.”
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