Stuart Wilson, managing director of the Equity Release Advisory Service, contacted MI after his request for a revised KFI was refused.
He said his client, on a lifetime product with Standard Life, needed a new valuation when they decided to move and transfer the mortgage to a new property.
However,
despite the bank confirming that the arrangement fee would not cost anything, it appeared on the KFI. Standard Life admitted the mistake and issued an e-mail that no arrangement fee would be charged, but refused to issue a corrected KFI.
Wilson said: “I don’t see why it could not give me a correct KFI, even when I pointed out it would break MCOB rules to refuse. This is corporate arrogance, and could damage my reputation as it forced me to use an incorrect KFI.”
In addition, Wilson said the valuation for his client’s new property was mis-quoted below the eventual cost, and the client was forced to pay £260 in legal fees to cover the lender’s expenses – a practice Wilson said was highly unusual.
Jackie Moran, head of sales, Standard Life Bank, responded: “Customer service is of the utmost importance to us. While we are unable to give specific details about this case, we can assure you we are investigating the matter fully.”
Robin Gordon-Walker, spokesman for the Financial Services Authority, explained that if Standard Life were refusing to issue correct KFIs it would be in breach of MCOB.
He said: “We are all capable of human error, but any lender that refuses to issue a new KFI once a mistake has been discovered is going against good practice.”
