The FSA has publicly censured London-based Mortgageland Limited for poor financial promotions, and inadequate sales and record keeping.
The firm has already been provided with external compliance advice in the past, but had still failed to deal with its problems.
The regulator found that the firm had made financial promotions which were misleading, and did not have its promotions approved by someone with an appropriate level of expertise. The firm was found to have produced a particularly high-volume of non-compliant promotions.
Mortgageland failed to obtain appropriate details on customer circumstance to justify its recommendations, which the FSA says is particularly serious as many of its customers had adverse credit histories or were seeking to consolidate debts.
The firm also failed to record customer details and failed to record explanations for recommending particular products to its customers.
Margret Cole, director of enforcement at the FSA, says: “It is essential that firms' financial promotions are clear, fair and not misleading, so that consumers know exactly what they are buying.
“And poor financial promotions often go hand in hand with other problems at firms – in this case, the firm also demonstrated poor record-keeping, both in terms of assessing suitability and documenting recommendations made.”
The FSA says Mortgageland’s failing were mitigated slightly as no customers were found to have taken unsuitable products and the firm reacted quickly once the FSA highlighted its concerns. Mortgageland also plans to join a network as an appointed representative to access additional compliance resources.
If you would like to comment on this story, contact:
Tel: 020 7484 9805
e-mail: [email protected]
'Necessary steps' taken
Penalty payments and enforcement policy
Fees as low as 0.04%
Client procurement costs ‘unsustainable’
Only 9,486 applied for the benefit in 12 months