Equity Release  

Scale of equity release mis-advice scandal revealed

A spokesperson for the Financial Ombudsman Service said it currently receives 50 to 100 cases about equity release every year, but data on uphold rates was unavailable.

A spokesman for the ombudsman said common complaints about equity release were about the amount of early repayment charges, how much needed to be repaid and the suitability of the product itself.

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The spokesman said: "Many complaints are brought to us by relatives – for example, after their parents have passed away.”

The Equity Release Council stated it had set out a framework for advisers to follow alongside their regulatory responsibilities.

It also publishes an adviser checklist detailing 13 of the most significant points to consider in the advice process when assessing any customer’s suitability for equity release.

In addition, the Equity Release Council hosts continuing professional development sessions and publishes regular market data to members and the wider industry.

Nigel Waterson, chairman of the Equity Release Council, said: “These activities are designed to complement providers’ own efforts to engage with the adviser community to ensure the specifics of their individual propositions are understood by those who advise on them."

Martin Bamford, managing director at Surrey-based Informed Choice, said members of the Society of Later Life Advisers needed to demonstrate their knowledge of equity release products by holding the Chartered Insurance Institute's ER1 equity release qualification or an equivalent.

He said: “When an adviser is recommending any product, they need to be aware of all of its features ensure the recommendation is suitable.

"Compared to some pension and investment products, equity release is not a particularly complex area, although it’s important to be well versed in the features before recommending it."