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It won&#39t do for the watchdog to bark for the FSA on mortgages

The Financial Ombudsman Service wants to bring mortgage advice under its

remit, if it can afford to.

This throws the FSA decision to exclude advice into sharp relief and

introduces all manner of unwelcome anomalies.

At best, it shows the current approach to mortgages is no better than a

bodge job, only serving to confuse the industry and public alike.

But cynics, and this paper in this instance is among them, must ask howthe

FOS will fund this project, even ifit were the best solution.

It is financing that sits at the heart of the problem. The current

voluntary regulator, the Mortgage Code Compliance Board, is trying to work

out how it can perform this voluntary role alongside the FSA&#39s statutory

role for the lenders themselves.

It is at best a poor relation of the FSA and it must face an uphill battle

to convince the lenders which finance it, to continueto stump up the cash.

The question that lenders must be asking themselves is why should they fund

this voluntary operation when they are also required to police

intermediaries themselves as part of product regulation?

The FOS&#39s statement of intent only serves to underline that a yawning

gaphas been left in the Government and regulator&#39s strategy for mortgages.

The decision-makers at the Treasury and the FSA should bite the bullet and

bring the sales and advice process for mortgages in from the cold. That

meansre-examining the FSA&#39s budget and working out a way to pay for it.

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