HML confirms FSA investigation is over but is tight-lipped on outcome

HML says the Financial Services Authority investigation into the firm, which was revealed in its 2010 accounts, has ended.

In its 2010 accounts the mortgage servicer, which is owned by Skipton Building Society, says it was subject to a probe and there was a risk it would be fined or have to pay redress.

The results say: “The company is in correspondence with the FSA following a thematic review. Investigations have been ongoing for some time and the issues involved are complex, particularly with regard to the application of the existing regulatory framework.
“It is possible that a liability may crystalise, whether from a fine, redress or both. The likelihood or quantum of any contingent liability is impossible to determine.”

But a spokeswoman for HML tells Mortgage Strategy the investigation has concluded.

She says: “There is no ongoing investigation and the matter has been resolved.”

She was unable to confirm what the outcome of the probe was.

Mortgage Strategy contacted the FSA to ascertain whether an investigation into HML had been concluded but it says it is unable to comment on specific firms.

The servicer, which is rumoured to be up for sale, has had a number of its customers fined by the FSA in the last few years for the unfair treatment of borrowers in arrears, including Redstone Mortgages, Kensington and GMAC-RFC.

The 2010 accounts reveal it made a profit before tax of £64,000 for 2010 compared with £3.4m in 2009. Its profits would have been £5.48m if it had not have been for restructuring costs. Restructuring included the closure of two operational sites and the transfer of certain functions to its head office.

The servicer has also reduced staff levels from 1,966 to 1,460, while its assets under management fell from £47.46bn in 2009 to £43.47bn in 2010.