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Mortgage broker trade body wins FOS claim against HSBC

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Sinclair: ‘The money is not the issue here, it’s the principle’

The Association of Mortgage Intermediaries has won £3,500 compensation from HSBC after the bank took around four and a months to reject the trade body’s application for a direct debit collection facility alongside its corporate bank account.

AMI applied for the service on 21 March 2012 following its split from the Association of Independent Financial Advisers in February, but it took HSBC, a direct-only lender, 15 weeks to reject the application.

On 16 July, HSBC said this was because it did not have three year’s worth of accounts, an annual income of £1m and £1m in capital.

Aifa collected the fees on AMI’s behalf until May but the trade body says it was unable to collect around £24,000 in fees in the six months to November.

On 21 November HSBC rejected AMI’s complaint that the delay caused the trade body to suffer a financial loss but it offered it a £500 for distress and inconvenience.. AMI rejected this and complained to the FOS on 15 March.

The FOS ruled in favour of AMI and ordered HSBC to pay the trade body £3,000 and a £500 distress and inconvenience offer. 

Sinclair says: “The money is not the issue here, it’s the principle. The issue is how difficult it is for a small business to deal with a large institution. It didn’t show the duty of care one commercial organisation should show to another one.”

HSBC declined to comment.

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