The Financial Conduct Authority has opened an enforcement investigation into Market Financial Solutions, the bridging lender that collapsed last month leaving hundreds of property investors facing uncertain futures.
The investigation follows revelations that several of the lender’s funders, including Barclays, blocked transactions after identifying irregularities before the firm entered administration. MFS, which specialised in short-term property finance for investors and developers, described the banking restrictions as a “procedural matter” at the time.
CEO faces spending restrictions
In a significant development, Paresh Raja, the CEO and founder of MFS, has had a worldwide banking order imposed by the lender’s administrators. The order prevents him from spending more than £5,000 per week without consent – a move designed to protect creditor interests as the investigation unfolds.
MFS is registered as an Annex 1 business with the FCA, meaning it is not authorised or subject to wider regulation. The firm is solely registered and supervised for compliance with money laundering regulations rather than broader financial conduct rules.
This follows Landlord Knowledge’s report on luxury London properties expected to hit the market following the MFS collapse, as borrowers scramble to refinance or sell to meet their obligations.
Bridging finance market implications
The collapse has sent ripples through the specialist lending sector. While MFS positioned itself as a solution for investors pursuing complex deals – including auction purchases and refurbishment projects – the FCA investigation raises questions about due diligence in the unregulated bridging market.
The FCA’s investigation will determine whether serious misconduct occurred and whether enforcement action is warranted. For landlords who relied on MFS financing, the priority remains securing alternative funding or finding buyers for their properties. Those in bridging arrangements should seek independent advice on their options.
What this means for landlords
- If you have MFS financing: Contact the administrators directly and seek independent legal advice on your position and options.
- Watch for: Further regulatory announcements – the FCA investigation could take months to conclude.
- Bottom line: The collapse highlights the importance of due diligence when selecting lenders, particularly in the less-regulated specialist finance sector.
Editor’s view
The MFS collapse is a reminder that bridging finance, while useful for time-sensitive deals, carries risks beyond interest rates. When choosing any lender – regulated or otherwise – landlords should consider the firm’s track record and financial backing, not just the headline rate.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 21 March 2026
Sources: Financial Conduct Authority, Mortgage Solutions, Financial Times
Related reading: Hundreds of luxury London homes set for sale after MFS collapse
