Mis-sold Mortgage Claims > Mortgage News
More Needs to Be Done to Tackle Mortgage Fraud
Wed, 02 Nov 2011
Most mortgage lenders internal control systems are able to deal effectively with preventing mortgage fraud, and conveyancers in particular should be the focus of greater scrutiny.

The rogue trader debacle ensured that banks' internal controls were strengthened in the glare of media spotlight.

Massive banks seemed unable to protect themselves against corporate fraud as was clear for all to see.

These weak controls need to be made stronger as financial services crime and data fraud especially are in the news.

Dealing with internal controls is already a priority for lenders . The years leading up to 2007 saw a buoyant mortgage market with mortgage lenders offering consumers a variety of mortgages.

It is clear that many were obtained under false pretences; certain lenders consequently suffered substantial losses.

Mortgage fraud has continued in spite of drops in lending following the financial crisis.

A 2009 scheme permitting lenders to check would be borrowers' income details against data held by HM Revenue and Customs succeeded in stopping £111m of suspect lending, and the National Fraud Authority estimated mortgage fraud losses to be approximately £1billion.

A Financial Services Authority review reiterated the warnings that lenders' internal control systems were still too weak, with conveyancing and solicitors being weak areas.

Many mortgage lenders identify solicitors as their biggest source of fraud risk, with a big lender stating that approximately 50% of their mortgage fraud losses are due solicitors' actions.
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