Appointed representatives were emailed on December 21 by Mortgage Times management and told that the firm had stopped trading and that advisers were no longer authorised to conduct business under the network. HM Revenue & Customs filed a petition to wind up the company which is due to be heard in the High Court Chancery division on January 13.
One employee told Money Marketing that staff were called into a meeting on December 21 and told the network was about to be placed into administration.
The email to ARs on the same day said: “At the 11th hour, a potential major investor has made the decision not to proceed and we have been left with no alternative but to cease trading.”
Other networks have confirmed they are in talks with Mortgage Times’ advisers.
Personal Touch Financial Services says it is talking to 55 ARs, with some applications already being processed, while Tenet says it expects to take on around 30 ARs in addition to 15 who joined over recent months. Both Home of Choice and Sesame confirm they have been in discussions with Mortgage Times ARs for as long as six months.
The network’s auditors raised concerns over its financial stability in its 2008 accounts.
Throughout the year, Money Marketing heard from a number of ARs who said they were owed commission by the firm. The network repeatedly pledged to repay all backdated commission after a distribution tie-up with Legal & General mortgage club but ARs are still claiming they are owed money.
DR Mortgages adviser Darpan Rhoda says: “I have been owed money for nine months and I doubt very much I will see that.”
The FSA has confirmed that Mortgage Times voluntarily withdrew its permissions. Advisers have argued that the regulator should have acted earlier.
Prosper Homeloans principal Paul McMath left Mortgage Times in December 2008 and says he spent nine months chasing missing commission. He says: “The FSA should have done something sooner. Mortgage Times has affected a lot of lives and some brokers will not come back from this.”