08 Sep FSA Fine Essex Based Firm for Treating Customers Unfairly

The FSA have fined the Essex based Swift 1st Limited after finding the company guilty of treating a number of their customers unfairly. The company, which offers sub-prime mortgage lending services, were accused of treating a section of customers facing mortgage arrears without due diligence. The company have agreed to redress customers who were charged "excessive" fees after entering into arrears, with the total cost of the redress being placed at £2.35 million. The failings in treating their customers fairly occurred for an extended period between June 2007 and July 2009, with Swift applying excessive charges to any accounts that had entered into arrears, creating a litany of charges including monthly arrears management fee, a default notice fee, an unpaid mortgage payment fee and litigation fees. Swift also applied excessive early repayment charges to the redemption figures of customers who were, or had been, in arrears according to the report compiled by the FSA. Finally the company also completely failed to supply their customers with the documentation that would have enabled to figure out which options were available to them and how they could best come out of the arrears, leading to some customrs overpaying despite redeeming their mortgages. The failings are believed to have impacted as many as 2,500 customers, with FSA acting director of enforcement and financial crime Tracey McDermott commenting "Firms must ensure they treat their customers fairly. Many of Swift’s customers were already in a vulnerable position, having fallen into arrears on their mortgage payments, and they could ill afford excessive and unfair fees. "The FSA will take robust action to ensure not only that firms are fined for such failings but also that they identify and compensate customers who have been disadvantaged. The costs of doing so are often much more than the fine."