The Financial Conduct Authority’s decision to increase broker fees is a ‘travesty’ according to Association of Mortgage Intermediaries chief executive Robert Sinclair.
The FCA said the year-on-year increase to intermediaries will be 8.5%, but Sinclair reckons this could rise to 50% for your one man band broker.
The regulator declined responding to Sinclair directly, but Martin Wheatley, FCA chief executive, said: “These proposals seek to share the cost of being regulated and ensure the FCA has the right resources in place to deliver appropriate protection for consumers and make markets work well.”
Sinclair said: “For the small broker who has paid the minimum fee of £1,000 for a number of years, this is to be increased to £1,084 and they will also have to pay a new levy to undertake consumer Buy-to-let totalling £350 to include their FOS levy.
“On top of this brokers have still to see clarity on whether or not they need a Consumer Credit permission to talk about some historic loans and mortgages raised for commercial purposes.
“In a zero inflation world, with government committed to reducing bureaucratic costs, this is a travesty.”
AMI has told the FCA in no uncertain terms that it need to justify why mortgage brokers are being hit so hard by fee hikes.
The regulator said it wants advisers to pay an extra £6.9m in fees – an increase of 10%, to pay for its staff and IT.
Overall the FCA has increased its annual funding requirements from £446.4m in 2014/15 to £481.6m in the 2015/16 year.