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Adviser
Community
The Independent Resource for the Financial Adviser Community.
Mortgage Fraud
(Why is it always the brokers fault?)
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There is an old Confucius parable if a glass hits a rock; it’s tough for the glass. If a rock hits a glass; it’s tough for the glass......it’s always tough for the glass. Being a mortgage broker in the current climate is a bit like being a glass. It would seem whatever the problem; the broker gets clobbered for it.
Recent Examples
The latest example I have experienced is mortgage fraud I have now had three brokers who are clients of mine who have had to defend charges of mortgage fraud from lenders. Successfully in two cases and unfortunately unsuccessfully in one. Putting the outcome in context however I should point out that successfully means they were either suspended by or unable to join networks for a couple of months which effectively meant they had lost between four and six thousand pounds each (they managed to rewrite some of the cases). A pretty hollow victory I’m sure you’ll agree, especially since neither of them got so much as an apology from the lender. For the broker who lost his appeal it was an unmitigated disaster as he has now had to leave the industry and is desperately looking for employment elsewhere(I’m sure his wife and two young kids will get by).
Retrospective File Evaluation
As I’ve said before and I’ll say it again I have no problem with kicking dishonest people out of financial services. There are still a few advisers with sharks’ fins sticking out of the back of their suits, and the sooner they have gone to join the tyrannosaurus and the Dodo the better for everyone. As we all know, the vast majority of personnel in the sector however are good ordinary decent people who like to do a good days work and then get back to their families. The problem seems to be that lenders don’t see them as either decent or ordinary, how else can you explain a system where, to give a recently quoted example, a broker is asked to collect proof of earnings for his client’s mortgage application. He does this in the form of 3 wage slips and 3 months bank statements, these are sent off to the lender who accepts them, and completes on the mortgage, but then on a recheck two years later finds an anomaly and accuses the broker of submitting fraudulent documentation. .
Call in The Police
The documentation which was asked for, was supplied, it passed the lenders “due diligence” procedures at the time, it seemed genuine enough, the wage slips and bank statements tallied, so how can this possibly be laid at the brokers door. If the applicant has been proven to have committed mortgage fraud, surely the police should be informed and the applicant dealt with by law, but in a lot of cases it just seems that the easy route is to suspend the broker, who often isn’t even told which case or cases the ruling is about and so can’t fight back. You can see the advantage of this to certain parties who can then claim to the FSA that they are taking a hard line while at the same time avoiding a police investigation which might show up weaknesses in their procedures, remember they had originally accepted the pay slips as had the broker. This might lift the problem from the lenders back but you’d struggle to call it justice.
Do You Have a Problem?
Whatever the problem, Which Network is in your corner helping to get justice for independent mortgage brokers throughout the UK. If you feel you have been unfairly treated or have come across the problem highlighted here, why not let us know se we can warn others in the industry.
