CML: FSA must issue clear broker guidance

News Category: Legal

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The Council of Mortgage Lenders (CML) has warned that the Financial Services Authority (FSA) will need to be clear in its guidance for mortgage brokers, but has welcomed its reviews into their customer service levels.

The financial watchdog undertook a series of reviews finding that several brokers continue to operate "well below standard" in terms of ensuring that customers are treated fairly.

It referred seven firms to enforcement and many others have been warned to put their houses in order.

However, the CML warns that good practice guidance must be made "as clear and unambiguous as possible", which is particularly important for small broking firms.

"After three years of regulation, the FSA is right to expect its regulatory standards to be in place across the whole market," said CML director general Michael Coogan.

"These findings are a wake-up call to those brokers who are behind the pace. But the FSA also needs to make sure that it sets out its expectations clearly and unambiguously, which does not always happen."

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