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Mortgage view

What is regulatory sauce for the goose is surely also sauce for the gander, no? It would appear not, especially when the sauce is improving professionalism, the goose RDR and the gander MMR.

There have been many unequivocal statements of intent from the regulator regarding forging ahead with the RDR. These have been coupled with a determination for not giving wriggle room on the deadline. Whereas the announcement by the FSA to delay for up to three years the implementation of the approved persons regime for the mortgage market has right royally kicked improving professionalism in our sector into the long grass.

The decision to delay introducing the approved persons regime to the mortgage market is extremely disappointing and sends out worryingly mixed signals. Not least because with these proposals it felt as if the regulator was finally getting it right by consistently applying the AP regime across all intermediaries and banks.

So why do we now find ourselves with a regulator so resolute on the issue for one sector of the industry, making all the right noises about the RDR and driving up professional standards, yet leaving the MMR in hiatus with no clear deadline? Why is it right to steam ahead with professionalism measures for investments but adopt a go-slow for mortgages? I am baffled.

We can already start to see regulation in our sector is beginning to slow down, as the regulator prepares to be split up and with housing not on the political agenda.

However, brokers must continue to prepare proactively for intrusive regulation and the impact of the MMR despite the FSA pulling back on implementation dates. Improving standards and professionalism in the industry should not be stopped by the delay.

Obviously, I would like to see clear deadlines for the curate’s egg that is the MMR, as the good bits of the review, for example, on disclosure, are worth getting behind and will ultimately be to consumers’ and intermediaries’ advantage.

I would argue now is the time to make the very strong case for all future consultations to be done in the round. We should take advantage of this delay to have full discussions on how all the different parts of regulation fit together, including the three consultation papers already published, as well as European proposals.

But in the meantime, if the issue for the regulator is in physically getting people through the approved persons process, then how about starting with brokers and intermediaries first?

I have spoken to quite a number of firms that support this move and providing it was part of a clear industry timetable, with bank advisers following closely behind, then I believe it should be considered.

John Cupis is managing director of PMS

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