Speaking to Money Marketing at the Conservative Party conference in Birmingham, Dunne says a guarantee was only as good as the guarantor and warned that to some extent this is a commercial decision for the person buying a product.
But he adds: “The FSA might like to take a look at the nature of the guarantees provided and whether they were clear.
“If you advertise a guaranteed return, then, to a degree, it is caveat emptor and partly the question would be whether these were held by retail inv-estors or more sophisticated investors.”
Dunne says he fears there may have been bad practice in the self-certification sector of the mortgage market.
He says: “I suspect there has been some pretty loose practice undertaken and I think that is something worth having a look at.”