The FSA has fined and banned a Bolton based mortgage and insurance broker for failing to act with competence and capability.
Riaz Ahmad has been fined £5,000 and prohibited from working in regulated financial services for failings, which include not having suitable compliance and risk management processes in place at Finance.com.
The problems at Finance.com were initially picked up by an FSA team conducting an assessment focused on treating customers fairly, as part of the regulator’s assessment programme for small firms.
The FSA's investigation found that Mr Ahmad was unable to demonstrate he had the competence required to be an approved person.
The watchdog listed that the mortgage broker failed to understand the responsibilities associated with running a regulated mortgage business; didn’t monitor the suitability of mortgage advice provided by Finance.com’s staff; failed to address compliance failings or liaise with his firm’s compliance consultants and didn’t put in place adequate risk management systems to prevent Finance.com being used to further financial crime.
As a result of these failings, the FSA found that customers were put at risk of receiving unsuitable mortgage advice and mortgage applications were submitted to lenders containing inaccurate and misleading information.
Margaret Cole, director of enforcement and financial crime at the FSA said: “This action confirms our ongoing commitment to ensuring that customers are treated fairly and firms have the necessary procedures in place to make sure they are not open to being used for financial crime.”
She added: “When firms fall short of these requirements, we will not hesitate to take action and the worst offenders will be punished severely."
The FSA also included that had it not been for Mr Ahmad’s financial hardship, the FSA would have sought a fine of £17,000. As he is the sole director and only approved person at Finance.com, his ban means the firm is unable to continue trading.
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