In a letter to the consumer director, Mary O'Dea, James Deeny complained that, while the guide describes and compares the various products on offer in the nascent market, "the regulatory status of the product and entity are relegated to the last item for consideration". The letter also noted that different providers are operating in the same market, but on different terms, and urged the regulator to "form and communicate a view" on the issue to policy makers and the public.

Under current law, socalled "lifetime mortgages" . . .which allow homeowners to borrow against equity without having to make repayments prior to the sale of the property or the death of the borrowers . . . are regulated as financial products, while home reversion schemes . . . which require the sale of a percentage of the home to release the equity . . .

are not. The panel favours regulation of home reversion schemes, as do providers in the sector, since they believe the regulatory stamp of approval will reassure customers who are wary of the product.

The panel had already expressed concern internally at O'Dea's use of "inappropriate language" in a press release announcing the publication of the equity release guide, according to the minutes of its 8 February meeting. The statement repeatedly used variations of the word "warn". An official warning notice from the regulator typically names firms which operate irregularly, illegally or without appropriate authorisation, although there are several instances of the word "warning" appearing in the regulator's other press releases.

A number of equity release providers contacted by the Sunday Tribune in April attributed a sharp downturn in their first-quarter business to the "warning", with one firm reporting an 80% drop in monthly sales enquiries. Two firms also scrapped their radio and television advertising campaigns to avoid the association of their brands with the regulator's statement.

More than 20,000 copies of the equity release guide have been distributed to the general public, making it the second most popular consumer pamphlet ever published by the regulator . . .after the SSIA guide.