The Financial Services Authority is taking a tough line on brokers applying to become appointed representatives, resulting in delays to the application process.
It is thought that the regulator is gathering more information on prospective ARs ahead of extending its approved persons regime to mortgage advisers.
This proposal formed part of the Mortgage Market Review and is being consulted on following an FSA paper published in January.
The newly-created CF31 function will only apply to senior directors in firms and those responsible for compliance rather than being applied to every broker. A policy statement is expected on changes to the approved persons regime in June.
An FSA spokeswoman says: “The FSA has more intensive supervision in place which means more checks. If the process is taking longer it’s because the regulator is taking its time to ensure everything is right.”
Paul Day, director of Which Network, says: “A lot of networks have come to us saying that the FSA is asking for more information on the ARs applying to join them. It is asking for more information and the process is taking longer. This may be the regulator getting ready to introduce the CF31 function.”
Ian McIver, managing director of The Whitechurch Network, says he hasn’t noticed a trend of delays with network applications.
But he has noted that the FSA is being more thorough when it comes to advisers applying from collapsed IFA networks Park Row and Alpha 2 Omega.
He says: “We’ve seen a number of applications from former Alpha 2 Omega advisers where the FSA has asked for four pages of additional information because of problems at the network.”
The latest network update, produced by Which Network, shows that in Q1 2010 the number of AR firms on the FSA register rose by 285.
Among the networks with the biggest gains were Financial Ltd, Julian Harris and Intrinsic Financial Services.
Financial Ltd gained AR firms from another part of the business while Julian Harris picked up ARs following the collapse of Mortgage Times.