The Mortgage Code Compliance Board is warning the FSA that it is in danger of taking a backward step by dropping the full disclosure of fees currently required under its code.
The MCCB is concerned that the proposal in CP146, The FSA's Approach to Regulating Mortgage Sales, that intermediaries will only have to state whether they got a fee from a lender but not reveal the value, could be to the detriment of consumers.
The MCCB says its rule that brokers must disclose the size of the fee if it is over £250 offers greater client protection.
It is also worried that the lack of a requirement for written confirmation of advice given in CP146 make complaints and redress more difficult for firms and clients.
But national broker Mortgageforce says that despite not being opposed to full disclosure, it recognises that the FSA must achieve a balance between protection and information overload.
The MCCB welcomes the FSA's proposal to recognise Maq and Cemap qualifications and grandfather them over to its new fitness and competence regime although this will not lead to automatic FSA authorisation.
MCCB spokesman Brad Baker says: “It is not enough for an adviser to say if they get a fee but not to have to specify the amount. It is only a proposal but it is a move backwards.”
FSA spokesman David Cliffe says: “One of the issues up for review as part of consultation is disclosure. We have not decided how we will accept MCCB qualifications or grandfathering. We have to consult.”