Financial promotions and sales flaws earn censure for Mortgageland

If a mortgage broker wishes to promote its services to people with County Court judgements (CCJs), loan arrears or defaults, it should ensure that the APR rate is given equal prominence in its marketing, the FSA states in its censure of mortgage broker, Mortgageland. The firm also breached MCOB3 rules in a second mortgage promotion by omitting the level of the broker fee and not disclosing that it factored in amounts for administration, valuation and solicitor’s charges. Mortgageland has since amended the phrasing to include the word ‘upfront’, as in ‘No upfront valuation fee’. The FSA also picked up on management and control weaknesses: financial promotions, although signed off every time they were issued, were not approved by a person suitably qualified. Information collected on customers’ needs and circumstances included expenditure on rent or existing mortgages but was insufficient to determine affordability. Associated record keeping was also deficient as evidenced when the broker was unable to produce an explanation for its advisers’ views that their personal recommendations met the suitability requirements.