FSA crack down on mortgage fraud

FSA crack down on mortgage fraud

The Financial Services Authority (FSA) has announced that it is cracking down on mortgage fraud, having already banned 17 brokers in the past 12 months.

The regulator says it wants to receive more information from lenders who spot suspect loan applications and will be working to improve intelligence sharing across the industry.

Lenders have been asked to report suspect mortgage brokers since 2006 and while over 300 tip offs have so far been received, they have come from only 35 of the UK’s 150 lenders.

FSA staff will also be visiting 200 intermediaries to assess procedures aimed at countering financial crime.

Philip Robinson, director of financial crime and intelligence at the FSA, says brokers need to ensure that their businesses cannot be used for the purposes of committing fraud and lenders need systems and controls to identify and reduce incidents of the crime.

The authority is arguing that easy credit conditions and streamlined application processes have led to mortgage fraud becoming widespread in recent years and that it will be taking particular note of cases where weaknesses may have contributed to a heightened mortgage fraud risk.

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