Your IndustryNov 18 2015

Birmingham Midshires reports broker to FCA

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Birmingham Midshires reports broker to FCA

Birmingham Midshires has hit a broker with a written warning and reported him to the FCA for not having evidence of a deposit for a buy-to-let loan the provider had approved months before, it is alleged.

Kevin Onions, director at West Midlands-based Independent Mortgage Advice Bureau, said a person from Birmingham Midshires had visited him recently, saying the team wanted to look at files.

As he is on the lender’s panel of IFAs, he said “I did not have a problem with that”.

Shortly afterwards, he received a letter from Birmingham Midshires informing him that submitting applications with incorrect information was not acceptable to parent Lloyds Banking Group.

He was also informed that Birmingham Midshires had written to the FCA.

According to the letter, this was because the broker did not have proof of a deposit on a BTL mortgage which had already been approved.

He claimed that such proof was not needed for BTL mortgages as the FCA did not currently regulate them.

Mr Onions said: “Proof of deposit for a broker is not a regulatory requirement, but if the lender asks for it, you send it.

“The problem with Birmingham Midshires is that it is asking for evidence of deposit, and may ask to look at it a year down the line. Birmingham Midshires is doing something different and putting brokers at risk of making a mistake untentionally.”

Mr Onions added that he did not expect to receive such a letter or the threat of the FCA.

Right to Reply

Ruth Wharram, press officer at the FCA, confirmed that the regulator did not regulate buy-to-let.

In respect of Mr Onions, she said: “We can’t comment on individuals and whether we have or haven’t received complaints.”

A spokesman for the Halifax, which owns BM Solutions, said: “We are looking into the allegation made by Mr Onions, but will not be able to give a response until we have reviewed the case.”