The Financial Conduct Authority has refused to act against two firms with sections of their websites dedicated to professional bodies with whom they have no official association.
The City regulator was alerted that the two firms were using the Equity Release Council name on their web pages.
A member of the ERC questioned whether action should be taken against the businesses as they could be duping the public.
However, a spokesman for the regulator said it was unconcerned about the websites.
The spokesperson said the regulator expected advisers to be fair, honest and open in the way they portray the services they offer to consumers.
As the two organisations do not currently state they are members of the ERC on their websites, the FCA spokesperson said they did not feel the advisers misrepresented themselves.
But Simon Chalk, technical manager for equity release at Age Partnership, said firms not holding Equity Release Council membership should not make any reference to it in marketing literature, including their websites.
He said: “It is totally unacceptable for adviser firms to promote the trade body’s standards in their marketing literature and on their websites if they themselves are not members.
“This could easily mislead unwitting customers to believe that the exceedingly high standards set by the council apply to that firm also, which isn’t the case at all.
“This is plain wrong and at worse duplicitous. You are either an equity release specialist dedicated to customer protection, or you are a dabbler; with membership being the defining element separating the two.”
Nigel Waterson, chairman of the Equity Release Council, said one of the two firms – Hertfordshire-based Viva Retirement Solutions – had originally claimed to be an ERC member.
However, when the ERC pointed this fact out to the firm it removed the offending wording.
When asked should non-member firms be allowed to refer to the ERC on their websites, he said: “We are naturally gratified if non-members see the wisdom of supporting the council’s standards.
“We would obviously prefer if they became members, not least because their compliance with our standards can then be monitored by our standards board.”
Paul Saroya, principal of Viva Retirement Solutions, said he was now in the process of becoming an Equity Release Council member after being contacted by the ERC about the use of the organisation’s name on his firm’s website.
When asked why his website had originally stated he was a member of the ERC when he was not, he said: “Rather than say we only deal with lenders who are members of the council, for some unknown reason it said we were members of the council. We changed that. I checked the wording that went to the people who deal with our website and that was correct. There was obviously a miscommunication between us and them.”
When asked could the mere mention of ERC on their website lead consumers to think they had signed up to the body’s standards, Mr Saroya said: “We would like to be totally clear. It [the website] says we only deal with lenders who are members of the ERC.
“But, what we are also doing is we are applying to be part of the ERC as well. The only reason we had not done it [become an ERC member] so far is because we are a brand new company.
“If we are members then there will be no issue there.”
Edward Ware, media relations manager of StepChange Debt Charity, the other non-member firm that mentions the ERC on its website, said his organisation was simply highlighting the charity’s preference for recommending plans from providers who observe the council’s code of practice. However, he said the website’s wording had been changed after Financial Adviser contacted the firm.
He said: “The section neither claims nor implies that the charity is a member of the ERC, and we do not believe this to be misleading. To ensure absolute transparency, the site has been amended to make clear we are not members of the ERC.”
