Promise Introducing Brokers Policy

Document Reference: PM-IBP-001 Version: v1.4 Owner: Compliance Team — Promise Money Next Review Date: [To be confirmed]

PROMISE INTRODUCING BROKERS POLICY

Our current business model is heavily dependent on new business referrals from brokers. The majority are regulated FCA entities in their own right and the service we offer them polarises in to:

(a) Broker sell – Promise functions as a packager in a business to business capacity only. We provide the broker with expertise and knowledge. Our research in to the referral results in the broker being able to advise on a suitable product. The broker is responsible for the advice and for meeting the FCA requirements surrounding it. We obtain all references and evidence required by the lender and administrate the application to payout.

(b) Promise sell – the broker refers a lead to Promise who take over the sale and assume responsibility for offering suitable advice. This includes obtaining the necessary application forms, carrying out a fact find, formulating suitable advice and packaging the loan to completion.

Our relationships with brokers are managed in accordance with the terms and conditions of an Intermediary Agreement. Intermediaries are required to accept the terms & conditions of the agreement before submitting any referrals.

Broker Due Diligence

Due diligence is achieved by way of mixture of the agreement and checks & balances carried out at key times throughout the sale. Summary as follows:

At registration

Check broker has appropriate FCA authorisation for the intended activity by consulting the FCA database of permissions. Significant issues regarding authorisation are flagged immediately to one of the Directors and a decision on how to proceed made without delay taking into consideration the type of services required by the broker.

Broker confirms acceptance of Promise’s Intermediary agreement

On receipt of each new application

Reconfirm broker has appropriate authorisation for the intended activity

Reconfirm broker has appropriate GDPR / ICo registration

Resend broker agreement

Ongoing

On regulated mortgages processing staff check and record discrepancies and concerns regarding documentation and broker/customer/Promise interaction. User friendly prompts are positioned within PQ to facilitate. The sort of data we are looking for includes:

Promise sell or broker sell

Staff ID

Severity – immediate resolution / monitor only

Inaccurate application information

Fraudulent payslips

Fraudulent bank statements

Fraudulent ID

Brokers insistent on not providing original documents

Brokers insistence on over involvement or avoiding Promise talking to customers

Brokers coaching customers on what to say.

Complaints data – added to the bank of information gathered in from the above. The information compiled is used to form an opinion on the ongoing suitability of the broker. Data gathered may include:

Reasons for the complaint – patterns & trends emerging

The suitability of the advice

The quality of service delivered

Examples of dishonesty

Introducer only brokers

Unauthorised brokers are permitted to introduce regulated leads (contact details only) on the strict understanding that they are not carrying out a regulated activity as defined in PERG 2.2.1 and that the exemption conditions specified in PERG 4.5.8 are adhered to. These are:

The Introducer must not do or say anything that may be construed as advice relating to the regulated mortgage contract being sold.

The Introducer must make his/her remuneration clear to the applicant at the outset. Preferably as a cash sum but if this is not possible the basis of the remuneration eg a % of loan size not yet determined.

The Introducer must not assist or offer to assist the applicant to fill in any of the application forms.

The Introducer must not advertise for leads in a way which might imply they are able to arrange or advise on regulated mortgage contracts. This applies to any and all real time or non real time promotions.

The Introducer must not pressurise or coerce the applicant in to proceeding with the regulated mortgage contract being considered.

Introducers are required to enter into an agreement which details our terms & conditions prior to any business being transacted. All introductions are dealt with on a strictly “Promise sell” only basis. We take the following steps in order to fulfil our due diligence obligations:

On registration the Introducer is required to agree to our terms & conditions. The registration information required includes a definition of how leads are generated and web site details. The web site requires a sign off from a Director.

On submission of a new regulated mortgages enquiry the Introducer is required to confirm they agree to our introducer agreements which includes (a) to (e) above prior to us contacting the applicant.

During the initial call to the applicant, at the point of knowing whether a regulated or unregulated product is required, we confirm verbally that the introducer has not strayed in to advice or acted inappropriately in a regulated manner – this is part of our script on introducer cases.

In our scripts and terms of business letter we confirm to borrowers details of any commissions / fee splits paid to introducers to ensure they are appropriately informed early in the process.

Should we become aware of a breach at any stage the case would be referred to the Managing Director (or other Director if not available) and a decision on how to proceed made. This would take into account the nature and severity of the breach and might include:

Our handling of the enquiry is suspended until the breach is remedied

The enquiry being cancelled completely

The Introducer being warned about future conduct or cut.

Where an introducer has a website we check that website doesn’t breach our requirements or appear to offer regulated products directly. If it does we refuse to take regulated business until the website has been amended and send the introducer a copy of the FCA guidance including our interpretations.

All Brokers & Introducers

Where there are any concerns about their activity causing a client detriment, these must be added to the broker watch list and to Broker CRM to warn all users to watch out for this activity or to cease taking business from that broker as appropriate.