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Mortgage Times reps left in limbo

Appointed representatives of Mortgage Times Group have been left facing an uncertain future after the network ceased trading days before Christmas.

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.”

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. Glad they are gone! 7th January 2010 at 11:45 am

    I was an AR who is still owed a lot of commission. All I can say is I am glad they have finally been pushed to close down and the Directors get what they deserve. Chris May has lied through his teeth over the phone to me a number of times and I hope any future venture the Director choose also are a failiure!

  2. Watch out for networks with notice periods longer than 3 months and those that have minimum business levels with financial penalties. Be aware of networks (Intrinsic) that tell you about the fixed monthly charge but do not mention the % of turnover until you are close to signing. Good luck.

  3. I followed the lead of Mortgage Times biggest and most productive AR firm (they know who they are) and left MT just before they went down. I can’t believe that the majority of AR’s appear not to have made up their mind about which network to join. I realise that it’s a very important decision but don’t they have business to write now? If you’re interested the network we both joined is based in Ashford, Kent.

  4. Six questions which have yet to be resolved about the Mortgage Times.

    1) Why did the directors claim the company had been put into administration on 21 December 2009, when it now transpires the company never went into administration?;

    2) Why did the FSA withdraw permission to trade?;

    3) Did HMRC write to the directors on 14 October 2009 giving the company 28 days to clear its tax bill? If so, did this cause the directors to change their addresses on the Companies House register from their mansions to that of the office in preparation for insolvency?;

    4) The company instructed Carter Ruck at over £1,000 an hour to get the FT Adivser to back down on claims that the company was about to fail. Was Carter Ruck paid ahead of the authorised representatives who had paid membership fees?;

    5) When did the directors know the company could not meet its debts? Why did the company continue to take in new business on 21 December 2009; and

    6) What part did the FSA play in this? Why have they not decided to formally investigate this failure? Are they compromised by their own failures to act? If so, who should carry out an investigation?

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