Broker censured for self-cert failings

The FSA has publicly censured Doncaster-based broker Mortgages Remortgages for exposing up to 80 of its customers to the risk of being sold an unsuitable self-certified mortgage.

The regulator found the firm failed to make appropriate enquiries about customers' sources of income, expenditure, credit history and debt position so that it could properly assess the affordability of its recommendations.

It also failed to demonstrate the plausibility of customers' declared income and expenditure. The offences took place between January 2006 and April 2008.

The FSA has taken into account the fact the firm agreed to undertake a customer contact and remediation exercise. The FSA said it would have imposed a penalty of £20,000 but for the firm's financial position.

"At all times, and especially in times of economic difficulty, mortgage brokers need to give suitable advice to ensure that customers are not unduly exposed to financial hardship in the future," says Georgina Philippou, head of retail enforcement at the FSA.

"This is especially important in firms like Mortgages Remortgages who specialise in self-certified mortgages and advise customers who are consolidating debts or have adverse credit histories."

She adds: "The firm's failings exposed its customers to potentially significant financial detriment by failing to give proper consideration to the long term implications of the products recommended in relation to their financial circumstances."