The FSA has fined Select Mortgage Services £10,500 for inappropriate business controls.
Last year’s FSA sub-prime mortgage market advertising review found the Swindon-based company conducted poor financial promotions and inadequate sales processes in relation to general mortgage sales, not just sub-prime.
The regulator says Select customers “did not receive reliable information to help them make informed choices and achieve a fair deal”, after it failed to ensure its financial promotions accurately described its Capital Repayment Plan (CRP).
It also found the company had inadequate sales processes in place for recommending mortgages and inappropriate management systems and controls.
FSA enforcement director Margaret Cole says poor practice by mortgage firms creates high risk for consumers, especially those in the sub-prime market.
"Taking out a mortgage is one of the most important decisions anyone makes during their life,” she says.
"It is essential that firms' financial promotions are clear, fair and not misleading, so that consumers know exactly what they are buying.
“In addition, firms need to have the right sales processes in place so that they recommend suitable mortgages.”
Select was handed a £15,000 fine, but received a 30% discount after agreeing to settle at an early stage.
To comment on this story, contact:
0207 034 2681
‘Important to have an anchor’
Lack of innovation for solutions
Some 2,000 consumers affected
Achievements, charity work and other happy snippets