Why is the Consumers Association disappointed?
The Consumer’s Association wanted mortgage regulation to be as tough as the regime which already exists for pensions. Pensions advisers have to justify every sale they make as “best advice”. The 15bn pension mis-selling scandal was caused by advisers giving bad advice, steering customers away from company pensions to personal pensions (which meant a big lump sum in commission for them). If they hadn’t had the “best advice” rule, the advisers wouldn’t have been found guilty of mis-selling, and no compensation would have been paid. The Treasury has backed away from the crucial move that even lenders expected – bringing in a “best advice” regime for mortgage advisers. Mortgage advisers – those in estate agents, building societies and banks who advise their customers on which loan to get – won’t be subject to rigorous checks deemed necessary for pension sales. What do the banks/building societies have to say about the plan? They opposed this type of regulation until September last year, wh
