The Mortgage Code Compliance Board (MCCB) has welcomed the FSA’s confirmation that registered firms in ‘good standing’ with MCCB, the existing non-statutory mortgage regulator, will enjoy a smoother journey through the FSA authorisation process and receive a level of scrutiny which reflects the standards set
by the MCCB.
This follows a comprehensive review by the FSA of MCCB’s registration criteria and processes; its compliance monitoring arrangements; and its actions to deal with breaches when they occur. Additionally, as part of the review the MCCB rules were
compared with those of the FSA.
The confirmation was announced in a letter from Sarah Wilson, Director of High Street Firms Division at the FSA, to Luke March, MCCB Chief Executive.
The FSA confirm that they now have sufficient evidence to regard MCCB registered firms in good standing as presenting a lower risk to the FSA’s statutory objectives than otherwise similar applicants and that, in anticipation of higher quality applications from such firms, the FSA would expect to devote fewer resources on average to such firms within the authorisation process.
Sarah Wilson adds in her letter that where the FSA does have to conduct further inquiries into a firm’s application, factors such as time registered with MCCB and the degree and intensity of regulation applied to the firm will influence the FSA’s judgement. Very significantly, the FSA confirms that to benefit for due credit firms must maintain their MCCB registration until ‘Mortgage Day’ (31 October 2004); firms that resign their registration will be subject to additional scrutiny.
Luke March, MCCB Chief Executive, says: “The FSA’s confirmation is a clear endorsement of the strengths of the Mortgage Code, the MCCB Registration Rules and the application of our processes and standards for registration, monitoring and enforcement. The great majority of firms in
the industry have worked hard in partnership with us to raise standards over the last 4 years. The others have long since been forced out by the increasingly onerous standards we require and by the vigour of our Fitness and Propriety processes and
compliance monitoring. I am pleased that the hard work of so many firms is being recognised and rewarded in the FSA authorisation process. MCCB will ensure there is a truly seamless transition to the FSA on Mortgage Day and will announce details of its 2004 registration renewal process in January. A full renewal will allow all firms in good standing to receive due credit towards FSA authorisation. This smooth transition has always been the goal of the Treasury, FSA
and ourselves, with the full support of the industry.”
