FICOM to allow grace period

FICOM to allow grace period

FICOM to allow grace period B.C.-based brokers will soon have to disclose commission details to clients, but they will have time to adapt to the change.

“We anticipate the release of improvements to conflict of interest disclosure by no later than September 1, 2016,” the Financial Institutions Commission said in an industry update. “To ensure industry has sufficient time to adjust business processes and practices, we anticipate enforcement of the improved disclosure requirements to commence by no later than January 1, 2017.”

FICOM said it received over 70 submissions from industry stakeholders in response to its previously released open letter. It said it will continue to welcome feedback; brokers can do so via this email address.

The regulator said it plans to overhaul the disclosure form, with the intention of making it easier for both homebuyers and brokers to understand.
“To better enable brokers and brokerages to meet their disclosure obligations under the Act, the Registrar will introduce guidelines to assist completion of the prescribed Form 10,” FICOM said. “These guidelines will replace the current ‘enhanced Form 10’.

“This approach will address industry confusion about the existence of two Forms 10s and simplify the disclosure that consumers receive.”

FICOM reiterated its reasoning for requiring the new disclosure rule, saying there are a “wide variety of potential conflicts that a brokerage may need to disclose.”

“Industry has identified that consumers may require additional information to place compensation disclosure in context, for example, information about the compensation provided by different lenders,” FICOM said. “A better informed consumer is a shared goal of both industry and the regulator, and we encourage industry to continue to explore how industry can contribute to that shared goal.”

To read the update in its entirety, click here.

  • Frank Piersanti 2016-05-02 10:44:03 AM
    how do you propose that major bank employees and mortgage specialists meet this new criteria? There is a direct hard and soft cost to this channel. Will that be identified?
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  • Ron Butler 2016-05-02 11:43:26 AM
    I would really like to see mortgage brokers stop going on and on about bank employees needing to have the same disclosure we must use. They are EMPLOYEES and their employers are responsible for their actions. This is a completely separate realm of law.

    We are independent brokers and we are regulated as such.

    To constantly make a false comparison diminishes our standing with regulators and the public.
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  • Carlo 2016-05-02 12:00:35 PM
    A meaningless MLS system, bidding wars, firm offers with NO Conditions is all ok, but lets disclose how much people are earning..Please, lets focus on the consumer with issues that have a real impact and be STANDARD on ALL purchase offers to include a 3 DAY Financing Condition..
    Post a reply