FSA fines North Wales broker £100,000

The Financial Services Authority has banned a North Wales mortgage broker and fined him £100,000 for exposing 1,500 customers to the risk of unsuitable advice.

Stephen Jones, senior partner of Jones & Poole Independent Mortgage Specialists was fined alongside junior partner Simon Poole. Poole was fined £7,000 for exposing 750 clients to the risk of obtaining unsuitable mortgages.

The FSA found that Jones failed to control his business effectively and to adhere to regulatory requirements. It also found that Jones did not treat customers fairly when recommending mortgage contracts.

Prior to a visit from FSA staff Jones arranged for customers to sign and back date fact find documents, and also provided a lender with false information to support his own mortgage application.

Poole, who ran the partnership’s office in Chester, was fined for failing to document whether a client could afford to pay the mortgage. He also failed to implement changes recommended by a compliance consultant.

Jonathan Phelan, head of retail enforcement at the FSA, says: “Jones and Poole exposed more than 2000 of the partnership’s customers to the risk of receiving unsuitable advice and losing money.

“Jones’ fraudulent mortgage application and his dishonesty in attempting to cover up regulatory failings were completely unacceptable warranting a ban and a large financial penalty. Poole’s failings were of a lesser order and although they were deserving of a fine he has not been banned.”

The two men had limited dealings with each other, running each office as a separate business.

Phelan adds: “It was in effect a dysfunctional partnership. It is important that partnerships which carry on regulated financial services business are organised so they can be controlled as a single business with clear lines of responsibility and accountability.”

Poole qualified for a 30% discount as he agreed to settle at an early part of the FSA’s investigation. Had this not been the case he would have been fined £10,000.