RBS gets two out of 164 mortgage sales right
The Financial Conduct Authority has fined RBS and subsidiary, NatWest, £14,474,600 for serious failings in their advised mortgage sales.
According to the regulator, both lenders failed to ensure that advice given was suitable to the extent that reviews of sales from 2012 found that in over half the cases, the suitability of the advice was not clear from the file or call recording.
Issues included failing to consider the full extent of a customer’s budget when making a recommendation, failing to advise customers who were looking to consolidate debt properly and not advising customers what mortgage term was appropriate for them.
Only two of the 164 sales reviewed were considered to meet the standard required overall and there were even examples of advisers giving personal views on the future movement of interest rates.
The FCA’s director of enforcement and financial crime, Tracey McDermott, comments: “The FSA initially drew the firms’ attention to issues in their mortgage advice process in November 2011 following a review of branch and telephone sales.
“The firms did not begin to remedy the issues raised by the review effectively until the end of September 2012 despite the fact that the firms made assurances to the FSA in July 2012 that the necessary changes were well underway to address the FSA’s concerns.”