The Association of Mortgage Intermediaries says the FCA’s new competition objective could help brokers fight lender decisions to remove them from panels without good reason.
AMI is handling a number of cases of brokers who feel they have been unfairly removed from lenders’ panels without explanation.
The trade body says some brokers have been removed from one panel for no obvious reason, which then triggers their removal from other lender panels, and wants a standard appeals process introduced to tackle the problem.
AMI chief executive Robert Sinclair says the FCA’s competition objective, which allows the regulator to examine the market power held by providers, low switching rates, and why consumers do not buy certain financial products, could be used to help brokers challenge lender decisions to remove them from their panels.
He says: “As the FCA now has a competition objective it has the capacity to intervene where it feels lenders might not be allowing as competitive a market as might otherwise be possible.
“If some brokers are not able to offer some lenders’ products then it does affect competition. You can understand why someone might restrict distribution at the outset but when large lenders are removing brokers for arbitrary reasons then it seems strange to me.”
Sinclair adds he may approach the regulator to intervene in panel decision cases where competition may be affected.
In 2011 Lloyds Banking Group revealed it had kicked off 900 brokers from its panels for problems including fraud or lack of business.
If you are a broker who has been kicked off a lender’s panel and you feel you have not had a fair opportunity to explain your case, please contact Mortgage Strategy deputy editor Paul Thomas at email@example.com.