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Financial watchdog wants to oversee mortgages

The Financial Ombudsman wants mortgage advice to come under its

jurisdiction if it can find the resources.

Head of communications for the ombudsman David Cresswell admits he would

like to see both mortgage and general insurance brokers invited to join the

scheme on a voluntary basis.

The move has been welcomed by the industry which believes it could help

fill the vacuum left by the FSA decision not to regulate mortgage advice.

But mortgage brokers want the Financial Services Authority to assume

responsibility for regulating mortgage business.

The ombudsman has no idea how many complaints would be involved in

monitoring mortgages. Given the substantial task already ahead of it, it is

cautious about extending its mandate.

Cresswell says: “In due course, we would like to extend the voluntary

provision to include mortgage brokers. It is something we are very keen to

do but we do not want to bite off more than we can chew.”

FSA director David Kenmir says: “The ombudsman has the ability to extend

its jurisdiction. It could bring in mortgage advice if it wanted to.”

Mortgage adviser John Charcol technical director Ray Boulger would welcome

the move. “We were expecting regulation of advice. It is a good thing for

the majority of the industry.”

The Financial Ombudsman Service, created out of the merger of eight

existing ombudsmen, is scheduled to be operational by the autumn.

Comment, p29

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