Liability of UK Mortgage Providers for claims made by intermediaries?

Good.

There's been several examples of people being screwed by bad brokers who attempt to evade responsibility on this forum whilst the mortgage provider throw their hands in the air saying 'it's got nothing to do with us'. Being able to take action against a company with more financial assets who can't easily pull the same evasive stunts offers a better prospect of success for the victims. It's also common business sense - if a company allows a third party to resell their products, that third party becomes a representative of their company in most peoples eyes. If the third party behaves badly, the companies selection procedures are bad, and the company should take responsibility and compensate the customer, sue the advisor and cancel their relationship.

Sorry, haven't heard about this. Have you used a search engine ?

Daytona

"Daytona" wrote

Do you think the premiums of these products will be increased, or the payouts reduced, in response to this?

Which is totally the opposite of the situation when buying things in a shop. In that case it's the shop that has total responsibility to you for the goods they sell. As we seem to be moving more and more towards the idea that buying financial services is like buying something in a shop it seems perverse to try and make the rules different.

I think the OP's belief is correct. However, a lender cannot know what is being said about its products by the advisor to the client so I think it's highly unfair to slate the lender in these circumstances.

Being able to take action against a company with more

No. An independent mortgage advisor is independent precisely because he is not a representative of the lending company. A customer who sees it as you have described must have his brain disconnected. If you go into a shop and buy an object and you are told by the shopkeeper that it will do this that and the other and it doesn't, that is hardly the fault of the manufacturer (unless he's written it in the blurb).

If the third party behaves badly, the companies

What selection procedures? How will a lender keep tabs on every advisor out there? How will it vet new people who may join a firm let alone all those who currently arrange mortgages? Mortage advisors already come under a regulatory environment (which will change in November) but whatever the system, it's inevitable that bad advice will be given by someone somewhere - even unwittingly.

Rob Graham