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Britannia axes 3,600 sole practitioners

21 August 2009

The Britannia Building Society, which merged with Co-operative Financial Services at the start of the month, is to axe 3,600 sole practitioners from its conveyancing panel.

A spokesman for the building society said it was forced to make the cull after its insurers warned that “mortgage fraud insurance cover for the entire business would be withdrawn” unless it stopped instructing sole practitioners for Britannia or Platform Home loans.

He went on: “The insurance market as a whole has hardened over the last 12 months. Cover is more expensive and more restrictive. Our insurers will not give sole practitioner cover and many other insurers won’t either.

“We owe a duty to our members and customers to ensure best cover at the best price, so we can’t simply choose cover at any cost.”

The Law Society was alerted to the move on Wednesday. President Robert Heslett said he was “shocked and saddened” and has written to the building society to express his concern.

“The implications for the 3,600 businesses and the people employed by those businesses are stark, to say the least, and could have a knock on effect on access to justice if any are forced to close as a result,” Heslett said.

“It is particularly disappointing that this decision should come from organisations with the reputation and standing of the Britannia Building Society and the Co-operative movement who understandably make much of their long-standing commitment both to the mutual ideal and the communities they serve.”

In a separate development, the Chelsea Building Society has announced that it has had to set aside £41m to cover potential losses from mortgage fraud, particularly on buy-to-let loans.

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Discrimination Tribunals & Courts Conveyancing