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Realistbear

Halifax And Nationwide Embroiled In Overvaluation Fraud

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http://www.thisismoney.co.uk/news/article....77&in_page_id=2

Property value fraud hits major lenders

Jeff Prestridge, Mail on Sunday

30 April 2006

TWO of the country's biggest lenders, Nationwide Building Society and HBoS, have become embroiled in a suspected multi-million pound fraud involving false valuations on properties.
Cheshire Building Society and Societe Generale have already admitted they are victims of the fraud, based on the over-valuation of commercial properties against which they provided finance.

This may be the tip of the iceberg. Could it be possible that overvaluation has been going on in the residential market also? Ironic that it is the VIs who may be the victims of their own greed.

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[Could it be possible that overvaluation has been going on in the residential market also? Ironic that it is the VIs who may be the victims of their own greed.

In any financial market there is always going to be an element of fraud because someone will always find a way around the safeguards.

Overvaluation of residential property no doubt happens but more likely to be a clueless surveyor than deliberate fraud. As banks etc appoint their own valuers from a panel of surveyors it is much more difficult to do this as you can't guarantee that the dodgy surveyor is the one doing the survey.

The residential fraud case I know about involved the collusion of a building society manager, surveyor, solicitor etc etc as it needs all parties to help it along. Suing the RICS is not likely I think but the surveyor’s employers or insurers might pick up the bill if they can't recover the money.

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I heard that round my way there'd been a fair few repossessions whereby the lender, having repossessed the properties, discovered that they had lent 50% more than the ceiling price for the road. I can't remember my source, but a reasonable one - but not one I'd bet my house on (if you'l pardon the expression).

The RICS could only be sued if they had

(1) Failed to disqualify a fraudulent surveyor who they should reasonably have known was fraudulent. (I can't see that they'd do this).

(2) Their procedures produced wrong results (if the reason for the valuation was fraud then this wouldn't apply)

FF

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the nationwide were stitched up during the last boom/bust of the late '80's

one case that stuck in my memory was that they had mortgaged some railway arch workshops down in london.

unfortunately they had mortgaged them several times over! :P

it is the same story time and time again - during the boom periods their internal systems are not able to cope with the volumes that are put through so instances of fraud are almost guaranteed to emerge sometime down the line... :rolleyes:

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it is the same story time and time again - during the boom periods their internal systems are not able to cope with the volumes that are put through so instances of fraud are almost guaranteed to emerge sometime down the line... :rolleyes:

During the boom years no-one cares about ongoing fraud.

The same happenend during the 1929 boom and the dot-com boom, while people are making money they couldn't care less.

When it all goes t!ts up, as it always does, the witch hunt begins to find the "perpetrators".

The masses who were complicit in the fraud look for someone else to blame.

We're only just beginning to see the start of this witch hunt, but I reckon it's going to be a clanger.

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  • 301 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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