The sons of Richard Riding, co-founder of Paymentshield, say they are “heartbroken” at the way the company’s good name is being “dragged through the mud” because of its decision to cut off commission payments to unregulated brokers.
Gareth and Michael Riding both left the company in 2005.
Michael Riding claims that if the previous owners were in charge, “every single agent would still be receiving commission, irrespective of their status and of regulation”.
He adds that he and his brother will make themselves available to assist brokers affected and are willing to work with an industry representative to put together an action group if this would help.
He says that agents who signed up to Paymentshield prior to FSA regulation have it in their contracts that they can close their agency and receive full commission on all existing cases.
He adds: “These agents were never regulated and never signed the new agency agreement, so regulatory obligations do not apply to them.”
Chris Traynor, sales and marketing director at Paymentshield, did not want to comment, but in Mortgage Strategy’s letters section this week, he says: “At the point of regulation we were required to set up new agencies for all our existing agents in such a way that those new agency agreements would reflect the terms and conditions of a sector that is regulated.
“Statements made by senior Paymentshield management promising payments for life was made prior to our industry being regulated. Market practices have since changed.”
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