Edeus says it will be five years before serious industry nasties are exposed

Edeus has predicted it will be five years before what it calls the “real nasties” in the market are exposed.

Alan Cleary, managing director of edeus, warns that the Financial Services Authority’s recent spate of fines was just the tip of the iceberg.

He says: “I think it will take about five years before the real nasties come out. We will remove brokers who we think are doing things in a dodgy way.

“In about five years the FSA will get properly stuck in. My advice is to keep your paperwork robust as that’s where everyone gets nailed.”

And Chris Cummings, director- general of the Association of Mortgage Intermediaries, says the FSA will turn up the heat.

He says: “Our industry is like a boiling frog. If you put a frog in boiling water it jumps out. But if you put it in tepid water and turn up the heat slowly, you soon have a boiled frog.”

However, he highlights that recent FSA mystery shops failed to provide evidence of widespread malpractice.

But Richard Fox, chief executive of the Society of Mortgage Professionals, warns that studies consistently find 40% of brokers are not up to scratch.

He says: “That is not good enough. How many cowboys are there in this industry? I think it must be about 5%. The FSA doesn’t want to fight us, it wants to help us.”