'Early-stage operators without adequate grounding in financial services are more vulnerable to making poor decisions'
Simon Bednar (pictured), chief executive of mortgage aggregator Finsure, has delivered a stunning dress down of the professional standards of some new-to-industry (NTI) brokers in an open letter sent to the press Wednesday.
Bednar criticised the “lazy compliance practices” of some new-to-industry brokers and warned of reputational damage to the wider broking industry.
“While many new entrants build successful, ethical businesses, Finsure has observed an over-representation of misconduct within a small segment of the NTI cohort,” he said. “We have unfortunately seen examples of phoenix-ing, lazy compliance practices and brokers cutting corners. It is a minority, but it is a pattern we cannot ignore.”
‘Phoenix-ing’ refers to the deliberate stripping and transferring of assets and funds from one company to another in order to avoid paying liabilities.
While not confined solely to NTI brokers, “early-stage operators without adequate grounding in financial services are more vulnerable to making poor decisions”, he said, adding: “When someone enters the industry without meaningful prior experience, they can underestimate the complexity and responsibility that comes with writing loans. That is where risk can emerge.”
Bednar warned that lower standards risk impacting customer trust in the broking industry.
In response, Finsure has decided to lift its entry standards. All new brokers must now have a minimum of two years’ experience of loan assessment or direct customer conversations that assesses credit requirements.
“If they don’t – and there are no exceptions – they must complete our Academy program, or they won’t be accepted by Finsure,” said Bednar.
Finsure has also strengthened its mentoring framework. Bednar said: “Our mentors undergo their own formal training and operate within a stringent framework developed by our compliance team. Mentorship isn’t just a tick-a-box exercise – it’s structured, accountable and outcomes-driven.”
“Finsure is proud to take a leadership position in lifting standards. We are proud of the calibre of brokers within our network. Professionalism is not optional – it is foundational,” added Bednar.
He also touched on the low barrier of entry into the mortgage broking industry, although he praised the work of the Mortgage and Finance Association of Australia (MFAA) in lifting these standards.
“Barriers to entry are certainly higher than they were historically, however it is still possible for someone to attain the qualifications required to write a loan in a matter of days. That raises important questions about preparedness, experience and long-term professionalism."
The full letter is can be read below:
Australia’s mortgage broking industry continues to grow at pace, but questions are emerging around whether rapid expansion – particularly among New to Industry (NTI) brokers – is creating unintended risks for consumers and lenders alike.
While competition is healthy, the industry must be careful not to confuse accessibility with readiness.
The broker market is not necessarily oversaturated, but it is evolving rapidly. Barriers to entry are certainly higher than they were historically, however it is still possible for someone to attain the qualifications required to write a loan in a matter of days. That raises important questions about preparedness, experience and long-term professionalism.
I believe the modern broking landscape is far more complex than it once was. Regulatory obligations have intensified, client expectations have increased, and brokers are increasingly diversifying into asset finance, commercial lending and wealth services.
This is no longer a transactional industry. Brokers today are running sophisticated financial services businesses. Education requirements are rising, compliance obligations are more complex, and the expectation on brokers to operate as true professionals has never been greater. Experience in financial services is more poignant than ever.
The Mortgage & Finance Association of Australia (MFAA) continues to play an important role in uplifting industry standards.
The MFAA has taken significant steps in recent years to professionalise the industry — from strengthening education pathways and ongoing continuing professional development (CPD) requirements to reinforcing ethical standards and compliance expectations. That leadership is critical as our channel continues to grow. The trajectory is clear: higher standards, greater accountability and a more professional broker workforce.
While many new entrants build successful, ethical businesses, Finsure has observed an over-representation of misconduct within a small segment of the NTI cohort.
We have unfortunately seen examples of phoenix-ing, lazy compliance practices and brokers cutting corners. It is a minority, but it is a pattern we cannot ignore. When standards slip, it impacts consumer trust and damages the reputation of the entire industry.
This poor behaviour is not confined exclusively to new brokers, but early-stage operators without adequate grounding in financial services are more vulnerable to making poor decisions.
When someone enters the industry without meaningful prior experience, they can underestimate the complexity and responsibility that comes with writing loans. That is where risk can emerge.
In response, Finsure has introduced additional requirements designed to strengthen broker capability from day one.
We made a conscious decision to lift our entry standards. All new brokers must have a minimum of two years’ experience of loan assessment or direct customer conversations that assesses credit requirements. If they don’t - and there are no exceptions – they must complete our Academy program, or they won’t be accepted by Finsure.
The success of this approach is evidenced by our Banker-to-Broker program, where we have seen experienced financial workers make the transition to broking, and operating in a structured, professional manner.
Finsure has also strengthened its mentoring framework to ensure the right support is in place.
Our mentors undergo their own formal training and operate within a stringent framework developed by our compliance team. Mentorship isn’t just a tick-a-box exercise – it’s structured, accountable and outcomes-driven.
Finsure is proud to take a leadership position in lifting standards. We are proud of the calibre of brokers within our network. Professionalism is not optional – it is foundational.
At the end of last year, Finsure provided lender partners with a first look at its proprietary AI-driven monitoring tool, Sentinel.
Sentinel is helping us proactively identify potentially nefarious activity within our broker network. Rather than waiting for problems to surface, we can detect anomalies and behavioural patterns early.
Importantly, it helps our Compliance Team quickly identify corporate relationships which were previously obscure. The tool enhances oversight and strengthens collaboration with lenders.
Our responsibility is to consumers, to lenders and to the broader industry. Technology like Sentinel gives us greater visibility and allows us to act swiftly if standards are not being met.
