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FSCS broker levy set at £4m

The Financial Services Compensation Scheme has announced that £5m will be levied on home finance intermediaries this year, with brokers paying £4m.

Provider contributions, which the FCA introduced as a requirement in May 2018, will provide the remaining £1m of the total levy.

This is a significant fall from the £25m paid last year, due to brokers no longer having to contribute towards pensions and investment claims.

The figures are stated in the 2019 – 2020 budget, published today.

The budget also shows that the 2018 – 2019 plan and budget assumption for home finance intermediation was 684 cases, whereas the estimate of completed claims was actually 1,605 – a 135 per cent change.

The plan and budget assumption for 2019 – 2020 has been set at 696 cases – a 2 per cent rise on last year.

The spike in numbers in last year’s claims is explained by there being “increasing volumes of mis-selling claims being provided with very little substance or evidence to support the claim being made,” says the FSCS.

It adds that it is “making efforts to stop these claims before they are made and to make clear the evidence we would need to fully investigate the claims. This is factored into our forecast which sees the volumes and uphold rates return to their previous levels.”

Ami chief executive Robert Sinclair says: “This has been a two-year journey to achieve a fairer outcome for all mortgage brokers and it will have a significant impact on this year’s fees. This was a significant win for Ami, who were often the only entity arguing for these new and fairer class allocations and for the new 25 per cent provider contributions.”


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FSCS declares four mortgage firms in default

The Financial Services Compensation Scheme has named four mortgage and financial firms as becoming insolvent in December. Seren Independent Advisers Limited, based in Oxfordshire, Well Alley Limited in West Sussex and Gann Management Limited in Manchester all failed at the end last year. The FSCS also reports that HBFS Financial Services Limited in Hertfordshire is […]

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Search for new FSCS chief executive underway

The Financial Services Compensation Scheme has outlined a three-month plan to recruit a new chief executive officer to replace the outgoing head of the lifeboat fund Mark Neale. Neale has held the position at the top of the FSCS since 2010 and will leave to pursue “new challenges” next May when his current third three-year term ends. Recruitment […]


FSCS chief executive Mark Neale steps down

Financial Services Compensation Scheme chief executive Mark Neale will depart his role in May next year. Neale has held the position since May 2010 and is leaving to pursue “new challenges” when his third three-year term ends. He says: “I haven’t taken this decision because of any diminished commitment to FSCS.  I still find every day […]

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Mortgage advisers to pay higher FCA levy

Mortgage advisers will see their regulatory fees and levies increased by 3.8 per cent this year. The Financial Conduct Authority has published its feedback to April’s consultation paper on the draft fee proposals for the year ahead. This policy statement confirms the actual fee increases that will be paid by different types of regulated businesses. […]


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