Lenders facing OFT threatSOLE PRACTITIONERS: mortgage companies rebuked over anti-competitive practicesThe refusal of major mortgage lenders to instruct sole practitioners could be anti-competitive and might well be referred to the Office of Fair Trading (OFT), the Law Society warned this week.It is understood that a letter being sent to major lenders this week says the practice is anti-competitive because it restricts borrowers choice of representative.It may also be indirectly discriminatory as a high proportion of solicitors from ethnic minorities practise as sole practitioners, the letter is thought to suggest.

Lenders are being pushed for a response as the Society is said to be ready to refer the matter to the OFT at the earliest opportunity.

Sole Practitioners Group chairman Peter Williams said he was delighted at the news.

We have been pressurising the Law Society to take this step for some time, as this is the single issue of most concern for sole practitioners, he said.I have received numerous letters from sole practitioners whose longstanding clients have been forced to move to other solicitors because lenders simply refuse to instruct them, he added.Fiona Hoyle, the Council of Mortgage Lenders senior legal adviser, refused to comment until she had seen the letter.Meanwhile, the Law Societys Council will be told this week that the possibility of allowing institutional conveyancing is the single most important issue to have been raised by the recent OFT report into competition in the professions because of its impact on the public.The Societys key arguments against the proposal are likely to be that there could be serious conflicts between lenders and clients over the arrangements for funding purchases, and that if lenders were free to do conveyancing, they could put unfair pressure on borrowers to use their in-house services.Victoria MacCallum