FSCS sees ‘notable’ rise in claims against brokers in 2016/17

Money

The Financial Services Compensation Scheme saw a “notable” increase in compensation claims against mortgage brokers in the 2016/17 year following a landmark court case.

The 2013 Court of Appeal case, between Charmaine Emptage and the FSCS, established that consumers could claim against regulated mortgage advisers giving unregulated property investment advice.

As a result, the lifeboat fund says it saw a big rise in these claims last year, according to its annual report and accounts, released yesterday.

The FSCS says the “vast majority” of these claims were made against Fuel Investments.

Mortgage Strategy reported in February that the FSCS had received a wave of claims against Fuel, which had been advising clients to remortgage their UK homes to free up money for high-risk property investments.

The lifeboat funds says: “To date, the majority of these claims have been eligible.”