The criticisms come after it came to light that networks are not legally obliged to inform brokers who are considering joining them, how many members they currently have.
Stephen Atkins, managing director at Freedom Finance, said: “Legally, the network does not have to divulge this information. In reality, they could be telling brokers any old number.”
David Hollingworth, mortgage specialist at London & Country, commented: “If a network only has a few members signed up, the danger is it could merge or be sold off.”
John Stewart, director at PMI Independent Financial Advisers, which has joined Sesame for the mortgage side of its business, said: “We had no idea how many members Sesame had in its mortgage network, nor did it tell us. But as Sesame is quite a big firm we are confident it has a large amount of members.”
However, Tony Jones, managing director at Pink, said: “The problem is we have lots of brokers in the system so it would be hard to give a definitive answer. Also, brokers don’t ask us how many members we have. But it would be a good idea to do so if the network has no financial backing.”
Richard Verdin, director at Enable, said: “This is a question we answer if asked – but what is the best answer for an adviser? Casualties are inevitable but I am not convinced that size is always a critical measure.”
