Chris Cummings, director of AMI, said the FSA’s explanation of the TCF rules seems to be gradually weakening the customers responsibility and putting more emphasis on the broker’s accountability.
He said: “Every time I hear about the TCF rules the customer’s role in the equation seems to be weakening. Last week I was listening to Anna Bradley from the FSA talk about this issue at a compliance roadshow and it appears the regulator is now expecting the intermediary to show that they have thought about all the outcomes that could happen in the future when advising a customer.
“But brokers are not clairvoyants. All the adviser can do is make a decision based on what the customer tells them and what products are out there in order to make an informed choice about what suits the customer best.”
AMI has previously warned the industry of regulatory creep.
The regulator is aiming to include the assessment of a firm’s effectiveness in treating its customers fairly as a systematic component in its ARROW assessments from 2005.
Robin Gordon-Walker, spokesman for the FSA, said: “There is a long-running debate taking place about these rules and further papers will be coming out. We have a number of principles that businesses have to abide by. While the TCF will certainly affect mortgage brokers, we welcome any comments.”
