The regulator says Derick Whewall and Alan Hewitt, partners of The Mortgage Exchange, did not ensure that the partnership gave suitable advice to customers, exposing about 250 customers to the risk of receiving unsuitable advice.
It also did not obtain and record sufficient information to establish customers’ needs and objectives and its assessment and recording of affordability of recommended mortgage contracts was inadequate.
The FSA also found that the brokers failed to ensure the partnership was organised so that it could identify and act upon obvious anomalies in false mortgage applications and help to prevent it being used by third parties to make mortgage applications on a fraudulent basis.
FSA director of enforcement Jonathan Phelan says: “The partnership’s systems and controls, management information process and monitoring of advisers fell way short of what is required creating unacceptable risks relating to unsuitable advice and financial crime. We are continuing to find instances where mortgage brokers are unwilling or unable to maintain the standards we require and where we come across this we will take action including banning them.”