The FSA has warned a third of mortgage firms have still not put adequate systems in place to meet its treating customers fairly (TCF) expectations.

In a newsletter to intermediaries, the regulator revealed it had carried out visits to 50 adviser firms, as well as conducting mystery shopper programmes on a further 50 firms.

It found that while the vast majority were gathering relevant management information (MI) about their businesses, a third were not using that information to review their processes and check they were TCF compliant.

It said: “It was disappointing that, in spite of producing some form of MI including key performance indicators, so many firms failed to consider these on an ongoing basis as part of their monitoring of advising practices. In addition many firms did not adequately consider findings from their review of customer files as part of their MI.”