Mortgage Lenders

The Financial Services Authority has confirmed that the five sub-prime firms it has taken enforcement action against are intermediaries rather than lenders.

Earlier today, the regulator published its report into the sub-prime sector.

It revealed its investigations had found weaknesses in responsible lending practices and in firms’ assessments of a consumer’s ability to afford a mortgage.

As a result the regulator has started enforcement action against five firms - which it says all operate in the intermediary market.

However, the FSA has declined to name the firms citing legal issues relating to public censure and due process.

A spokeswoman for the FSA confirmed that one reason for keeping the firms anonymous was down to protecting identities in order to help them correct internal issues.

However, she denied that the FSA prioritised protecting the five firms ahead of protecting consumers and other mortgage firms that might work with them.