The Financial Services Authority has called on firms to take urgent action to ensure their selling practices for payment protection insurance are in line with regulatory requirements.The warning follows a programme of FSA visits and mystery shopping that uncovered poor selling practices and a lack of proper compliance controls. Firms that sell PPI and insurers that provide the policies will be receiving detailed feedback on the FSA’s findings and will have to address any problems. Serious cases will be referred for further investigation with a view to possible enforcement action. Having put the industry on notice to improve its sales practices, the FSA plans a second round of thematic work early in the next financial year to check compliance levels have improved. It will also be meeting relevant trade associations to seek their commitment to improving the market. Clive Briault, managing director for retail markets at the FSA, says: “When properly structured, explained and sold, PPI can provide worthwhile cover for consumers against unexpected changes in their personal circumstances. We were therefore pleased to see that sales of regular premium PPI sold with prime mortgages are generally compliant. “However, compliance standards in other areas of the market, notably single premium PPI business, are generally weak. The firms in which these problems exist must take urgent action to address them.” Mike Naylor, principal researcher at consumer watchdog Which?, says: “There’s a danger that many people have been sold unsuitable policies, are paying more than they thought or don’t realise they won’t get a lot of their money back if they cancel the policy.” Ben Stafford, head of policy at the Association of Mortgage Intermediaries, says: “While it’s clear protection products for prime mortgages are being sold compliantly, firms dealing with sub-prime clients should consider these findings carefully. The insurance rules are no less binding than MCOB.”
Bank of Scotland Mortgages has introduced limited offers on two of its fixed rate self-cert mortgages.It is now offering a rate of 5.15% on its two-year fixed rate product to 85% LTV. The rate applies until December 31 2007 and then reverts back to the Bank of England base rate plus 1.99%. It is available […]
Advice and distribution firm Origen has become the first company to sign up its entire mortgage team for the Institute of Financial Services advanced mortgage advice qualification Advanced CeMAP.The seven-strong Origen mortgage team, headed by Wayne Gibbs, was formed in February 2005. Its team of mortgage brokers are spread across Origen’s branches in London and […]
Dear Delia Naomi has sold her buy-to-let property and is looking to buy again with Paul, her partner. They have found a property for 145,000 and Naomi is putting down a 52,000 deposit. They have a joint income of 45,000.
Some of the most important FSA’s Principles for Business focus on management and market conduct – including not trying to damage the reputations of competitor firms, says Bill Warren
With 23 auto-enrolment compliance notices issued by the Pensions Regulator, and an evolving legislative landscape meaning previously compliant schemes may now be in breach of regulation, now is the time to think about auditing your auto-enrolment scheme. Johnson Fleming is hosting a webinar on 9 October at 11:00 on how to audit your scheme to ensure compliance, avoid breaches and fines and overcome data issues.
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