Regulator allowed lenders to get us into this mess

I have been a member of a big network for the past 10 years and during that time have worked hard to pass internal exams as well as meet increasing compliance and form filling requirements while trying to earn a living.

I am now leaving the network, and possibly the industry. I have a loyal client bank but in times such as these it is nigh on impossible to earn a living. The base rate is low and there is an almost total lack of confidence in the economy as well as the housing market.

I recently explained this to a client who asked me who was to blame. Before I answered her I thought for a moment.

Even my 10 year old son could see that 125% mortgages were dangerous, that 100% mortgages were loans to those who couldn’t raise deposits and that self-cert was irresponsible, so why did the Financial Services Authority approve these types of products to be let loose in the marketplace?

Rather than implementing its costly Treating Customers Fairly initiative it should have been tackling the real problem – dodgy products. These deals were approved by the FSA as being fit for purpose but they weren’t – they were reckless and open to abuse.

It was lenders that needed the TCF treatment rather than brokers, as they designed the products we advised on. In fact, rather than the FSA imposing fines on brokers, is it possible for brokers to fine the FSA for ruining their businesses?

The regulator’s actions led to the overinflation of house prices, which led in part to the economic crash and the increasing number of repossessions we are now witnessing.

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