Linda Will, managing director of Accord Mortgages, is particularly concerned with information in last month’s TCF update, ‘Treating Customers Fairly – building on progress’.
Under ‘Product and distributor responsibilities’ the update reads: ‘Have firms considered their responsibilities in managing the risks to customers in the context of the relat- ionships between product manufacturers and distributors, and within networks and mortgage clubs?’
Will explained: “It may be that the update isn’t saying categorically that the lender is responsible for the broker but in our opinion it’s not too far away. TCF is written in such woolly language that you have to be defensive in your interpretation and with that in mind you become more alert.
“The update also talks about if we have the same values as those selling our products – we can’t effectively be responsible for this. We will be going to our board next month with our own TCF charter and telling them what we think we can and cannot be responsible for.”
In the consultation stage prior to regulation, the FSA initially felt lenders should be responsible for intermediary firms but was forced into a u-turn following industry pressure.
Will said: “I’m sure there are many in the FSA who would have liked to have sent the industry down this route. Now it seems that TCF is being used as the putty to fill the holes in the rules. We’ll be lobbying the Council of Mortgage Lenders and the Intermediary Mortgage Lenders Association to make sure there’s a firm push back against this.”
But Bill Warren, director of The Complete Network, believes lenders may be being paranoid. He says: “I understand their concerns but ultimately, and the FSA have been very clear on this, individual firms have to take responsibility for their actions. The bottom line is, if an intermediary has messed up in the context of TCF they will take the hit, not the lender.”
