View more on these topics

FSA will not apply RDR to mortgage market

As part of its mortgage market review, published today, the regulator says it has not identified a need for an RDR read-across.

It says QCF level four qualifications, which will be a minimum requirement for investment advisers, are not necessary in the mortgage space.

The FSA says: “First, we have found no evidence to suggest lack of training and competence is a significant issue in the mortgage market. Second, in terms of the level of competence required by advisers, the mortgage market is much simpler than the market for retail investments.

“The characteristics of mortgages can be compared in advance and do not rely to the same degree on inherently uncertain judgments about the relative rates of return and risks from investing in different assets.”

Adviser charging will not transfer across to mortgages under the FSA’s proposals. It says it is sufficient to address the incentives of lenders to lend responsibly and to restrict mortgage products which “create material risks to our statutory objectives”.

However the FSA is proposing to extend the approved persons regime to mortgage intermediaries, which will see them registered with the FSA, and to increase professional standards in the sector.

It states: “Principally, the individual registration of advisers by the professional standards board, which would provide a public record of all authorised mortgage intermediaries, would limit the ability of individuals to ‘hide’ from regulatory penalties. It would also give us the ability to track individuals throughout the industry.

“We also see merit in applying a code of ethics, and also firm-led initiatives on continuing professional development. Our views on these issues will depend on the shape decided for the PSB later this year.”


News and expert analysis straight to your inbox

Sign up


    Leave a comment


    Why register with Money Marketing ?

    Providing trusted insight for professional advisers.  Since 1985 Money Marketing has helped promote and analyse the financial adviser community in the UK and continues to be the trusted industry brand for independent insight and advice.

    News & analysis delivered directly to your inbox
    Register today to receive our range of news alerts including daily and weekly briefings

    Money Marketing Events
    Be the first to hear about our industry leading conferences, awards, roundtables and more.

    Research and insight
    Take part in and see the results of Money Marketing's flagship investigations into industry trends.

    Have your say
    Only registered users can post comments. As the voice of the adviser community, our content generates robust debate. Sign up today and make your voice heard.

    Register now

    Having problems?

    Contact us on +44 (0)20 7292 3712

    Lines are open Monday to Friday 9:00am -5.00pm