FSA has fined Approved Financial Solutions Ltd £63,000 for failing to ensure it gave suitable mortgage advice and for communicating inaccurate information about mortgage charges to its customers. FSA found the firm breached Principles 3, 7 and 9 and parts of MCOB. It did not:
- tell lenders relevant information customers had provided to it;
- have in place adequate systems to monitor the quality of its advisers’ advice;
- give its customers adequate suitability letters and could not show why contracts it recommended were suitable;
- disclose the right procurement fees to customers;
- recommended self-certification mortgages when a standard high street mortgage contract was clearly more suitable; and
- have a strong enough compliance regime to pick up that many customers provided false income and employment information in support of their mortgage applications.
The firm has addressed its compliance failings and appointed a skilled person to review its business. However, FSA found many customers had given false information about themselves, so did not think a past business review was appropriate.
It also censured Mohammed Habib, trading as MAH Mortgage and Finance. It found he breached Principle 9 and parts of MCOB because he failed to assess why customers would be able to pay mortgages he recommended. He also could not prove selfcertification mortgages he recommended were suitable. Also, he recommended mortgages into retirement without establishing whether the customer would be able to pay. He could not pay the £22,500 fine FSA suggested, so it agreed to a public censure and Mr Habib varied his permission to remove all regulated activities and undertook a remedial programme.