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IFA firms take an early lead in mortgage authorisation

The Association of Mortgage Intermediaries is calling for a “level playing field” between IFA networks which are already regulated and those coming into the market in the run-up to M-Day.

Director Chris Cummings says he is concerned about what will happen if IFA networks get their minded to authorise letters before mortgage networks, saying it puts them at an unfair advantage in the race to sign up members.

The AMI is also urging brokers not to delay choosing a network.

Cummings says he fears that brokers will delay making a decision which will cause problems for networks and put FSA systems under pressure in the summer when the regulator will also be dealing with applications for general insurance regulation.

He says: “We want to get people who want to be appointed representatives to make a decision now rather than delay.”

FSA press officer Robin Gordon-Walker expects the first batch of minded to authorise letters to be sent out to networks in the next week. Applications will be dealt with in the order they are received by the FSA rather than by the type of network they are from.

The FSA has already begun sending letters to authorised firms which have applied to do mortgage or general insurance business in addition to their current regulated activities. The vast majority will be IFAs, with 1,320 getting letters last week.

FSA high-street firms division director Sarah Wilson says the first dispatch of variant of permission marks important progress in the authorisation process and runs in parallel with bringing a large number of new firms into regulation for the first time.

Wilson says: “From now on, variant of permission notices will be sent out regularly to existing FSA firms in the normal course of our authorisation work along with minded to authorise letters to new firms.”

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