The head of Bill Warren Compliance LLP, said: "The FSA's recent enforcement action against a mortgage firm – shows how important it is for a firm's owners and those directly responsible for compliance within a firm to act on the recommendations of their compliance consultant, if they have one.
“With more and more firms quite sensibly using external compliance advice under the current regulatory pressures this is critical as has been demonstrated by the FSA. The FSA notice to the firm involved clearly showed that its failure to act on the advice of its
compliance consultant contributed to its compliance failings.
"For example, the firm was reminded by its compliance consultant that it should not rely solely on external support for monitoring and file reviews, but this advice was not implemented. In addition, the consultant pointed out failings in regard to fact finds some time previously - but these failings continued throughout the subsequent period.
"As the FSA's enforcement activity within the mortgage sector increases and becomes more widespread, it is crucial for senior management within mortgage firms to understand that compliance consultants can provide expertise, experience and objectivity - but that the firm itself and its senior management bear the ultimate responsibility for compliance."
