Lenders' no notice withdrawals ‘flouting TCF'

A broker, who wished to remain anonymous, questioned lenders’ commitment to TCF following his dealings with Bristol & West (B&W), which failed to honour an agreement-in-principle (AIP) he had obtained one working day before it pulled its range of fixed rate deals.

The Financial Services Authority (FSA) states in its TCF guidelines for providers that: ‘A firm must pay due regard to the information needs of its clients, and communicate information to them in a way which is clear, fair and not misleading’ – something that the broker does not feel lenders are doing.

B&W’s range was launched on 15 January and then withdrawn on 21 January. The broker had obtained the AIP on 18 January.

He said: “The FSA makes a big point about brokers treating customers fairly, but it needs to be a level playing field. If products keep getting pulled at short notice it is hard for brokers to react, as borrowers often want a few days to think things over. When they make a decision, it might be too late.

“Lenders are not treating me fairly, so I can’t treat clients fairly. TCF is a game to lenders. The tricks they come up with; they seem to think they can get away with anything.”

The FSA has placed a high priority on TCF and expects all firms to be able to demonstrate they are consistently treating their customers fairly by December 2008. However, a spokesperson for the FSA said it could not comment on individual practices.

Mark Howell, head of marketing at B&W, said: “We have been very consistent over several years in terms of the process we adopt in launching and withdrawing products. But in this particular case, we have seen unprecedented volumes in the last few days.

"We had to take the decision to withdraw products to ensure that service was maintained. However, we accept and apologise for the short notice that we gave. I don’t think it’s not TCF. In withdrawing products, lenders have to make decisions based on circumstances and on occasion that means acting quickly.”

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