The Financial Services Authority (FSA) fined GMAC-RFC, the UK unit of GMAC Financial Services, £2.8m (US$4.6m) for unfairly treating mortgage borrowers via excessive charges and inappropriate loan solutions. The UK regulator also secured compensation of up to £7.7m (US$12.79m), plus interest, for more than 46,000 mortgage customers, the FSA announced. Between Oct. 31, 2004 and Nov. 30, 2008, GMAC-RFC forced excessive and unfair charges for customers and proposed repayment plans that did not always consider individual circumstances. The FSA also found inadequate training of mortgage servicing staff for arrears and repossessions and that GMAC-RFC also issued repossession proceedings before considering alternatives. In the UK, foreclosure is strictly regarded as an option of last resort. As the FSA concludes its investigation this week, GMAC-RFC is working with the regulator to workout a process enabling customers to receive the compensation as quickly as possible, according to the announcement. Because of the settlement, the firm qualified for a 30% discount under the FSA’s discount scheme – reducing the fine from £4m to £2.8m. “This case shows credible deterrence in action. It is an excellent example of what the FSA’s more intrusive approach can achieve for consumers, and it reflects what we said in our Mortgage Market Review last week about unfair mortgage arrears charges,” said Margaret Cole, director of enforcement and financial crime at the FSA. Write to Jon Prior.