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Mortgage Fraudsters Beware - Industry And Regulator Are On Your Case

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Lenders, particularly the off balance sheet MBS new kids on the block, didn't give a flying in relation to; multiples, valuations, ethics, compliance... they were only interested in reaching targets and flogging off the debt to a bond seller/buyer they had a relationship with anyhow. Now it's all going tits up are they seriously suggesting they'll pin the blame on naughty Joe Sixpack who exaggerated his income, or the broker who 'assisted' him? Yes they are and they will, when in reality the real culprits have made their millions/billions and 'got the hell out of Dodge' <_<

Mortgage fraudsters beware - industry and regulator are on your case

The Council of Mortgage Lenders' efforts to tackle mortgage fraud have been recognised by the Financial Services Authority today, in a public letter which recognises the priority that the industry has given to fraud issues even in the current challenging market conditions...

The FSA encourages more lenders to become involved in the FSA/CML voluntary initiative to combat broker fraud, welcomes the anti-fraud measures that the CML is taking, and emphasises the priority that the FSA is giving to investigating and, where appropriate, prosecuting organised mortgage fraudsters.

CML Director General Michael Coogan commented:

"The FSA rightly identifies that the best way to tackle mortgage fraud is for lenders and the regulator to work together, along with law enforcement agencies, to root out fraudsters.

"People may not think of lenders as victims of crime, but unless fraudsters are tackled then honest customers are the ones who end up paying more.

"We welcome the FSA's focus and practical approach in this area, and we expect that even more lenders will now participate in the voluntary initiative designed to identify and investigate broker fraud."

http://firstrung.co.uk/articles.asp?pageid...&cat=44-0-0

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This is breathtaking arrogance from the CML.

They were told about what their members were doing by the BBC in 2003.

They encouraged growth in lending.

Now they say they werent aware.

filling Mr Coogans veins with molten lead is too good for him.

BUT, he now ackonwledges the effects it has on honest borrowers: They were FORCED/Encouraged to lie if they want to participate in the housing market, as liar loans puts the price up for everybody else.

Edited by Bloo Loo

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This is breathtaking arrogance from the CML.

They were told about what their members were doing by the BBC in 2003.

They encouraged growth in lending.

Now they say they werent aware.

filling Mr Coogans veins with molten lead is too good for him.

BUT, he now ackonwledges the effects it has on honest borrowers: They were FORCED/Encouraged to lie if they want to participate in the housing market, as liar loans puts the price up for everybody else.

good points and where would they/the fraud sqaud draw the line, exaggerating income, or inventing multiple IDs? in the 70's/80's it was time comsuming and difficult to weed out those ahead of the game. Not now, there is nail on bullet proof ways all lenders could have protected themselves and the CML know it. Lenders were not interested from 2005 onwards in rejecting anyone with a pulse and a false passport, and there is more than anecdotal evidence in the industry of stiffs getting mortgages, BTL covered a massive amount of wounds; in effect a business loan that required no proof of income or a plan. We'll get a few scapegoats, not in the city or wall street though... <_<

Edited by Converted Lurker

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Shame on the useless FSA.

Shame on the disgraceful CML.

Criminal neglect of risk and continual looking the other way when the lenders themselves were troughing out debt like candy to all an sundry via the broker network - all as long as some other sucker was buying up the sausage skinned parcels of liabilities at the other end.

And now the same financial misfits are asking for the system to be bent further to get taxpayer bailouts either directly or via inflation.

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Shame on the useless FSA.

Shame on the disgraceful CML.

Criminal neglect of risk and continual looking the other way when the lenders themselves were troughing out debt like candy to all an sundry via the broker network - all as long as some other sucker was buying up the sausage skinned parcels of liabilities at the other end.

And now the same financial misfits are asking for the system to be bent further to get taxpayer bailouts either directly or via inflation.

agreed it is a disgrace and shameful. The Daily Hate may get their justice but the real culprits are bomb proof.

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agreed it is a disgrace and shameful. The Daily Hate may get their justice but the real culprits are bomb proof.

Don't be such a pessimist. When one of these crops up in Eric's area, he will be putting in a full-spectrum, kaleidoscope of an affidavit as a person priced out of the local market as a result of this fraud.

In fairness, the press coverage will have to be in one of the colour supplents to meet the font, colour and hue demands.

A good judge (with Ray-bans) might then start asking for further information.

p-o-p

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Guest An Bearin Bui

Some of the provisions of the new Housing Bill that has just been passed in the US caught my eye for the same reason: anyone applying for relief under the provisions will have to verify their income to get help and second homes and investment properties are excluded from the Bill. So only those in their principal private residence who have submitted legally valid mortgage applications with honest income details are eligible for relief. That's obviously a good thing as taxpayers don't want to subsidise property flippers and fraudsters but where's the provision to prosecute the banks that pushed the liar loans in the first place?

I wouldn't be surprised if Labour, with their devotion to all things American (apart from lower taxes), use this Bill as a template for legislation to be introduced here in the Autumn. They're in the same dilemma as the US govt in that they need to look like they're doing something about housing but can't afford to do too much. That Bill could be a good stopgap - if so then the amateur BTL-ers, fraudsters and liar loan applicants can forget about getting any taxpayer-funded help :D:D

NY Times - Housing Bill Has Something for Nearly Everyone

So who is eligible? You need to have originated your troubled loan or loans on or before Jan. 1, 2008. The loans in question must be on your primary residence. Vacation homes and investment properties are ineligible. You will also need to verify your income, which many borrowers did not have to do in recent years.

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Some of the provisions of the new Housing Bill that has just been passed in the US caught my eye for the same reason: anyone applying for relief under the provisions will have to verify their income to get help and second homes and investment properties are excluded from the Bill. So only those in their principal private residence who have submitted legally valid mortgage applications with honest income details are eligible for relief. That's obviously a good thing as taxpayers don't want to subsidise property flippers and fraudsters but where's the provision to prosecute the banks that pushed the liar loans in the first place?

I wouldn't be surprised if Labour, with their devotion to all things American (apart from lower taxes), use this Bill as a template for legislation to be introduced here in the Autumn. They're in the same dilemma as the US govt in that they need to look like they're doing something about housing but can't afford to do too much. That Bill could be a good stopgap - if so then the amateur BTL-ers, fraudsters and liar loan applicants can forget about getting any taxpayer-funded help :D:D

NY Times - Housing Bill Has Something for Nearly Everyone

They added that caviat in so they wont have to pay much out. I mean, it was probably quite rare for a proven income borrower given good advice and the right deal thats in trouble now.

Its the fraudulent brokers, banks and borrowers who are in the mess, and I dont mean that you need all 3 conditions met for a fraud to have taken place, could just have been the broker, or the bank or the borrower that thats caused the fraud.

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They added that caviat in so they wont have to pay much out. I mean, it was probably quite rare for a proven income borrower given good advice and the right deal thats in trouble now.

Its the fraudulent brokers, banks and borrowers who are in the mess, and I dont mean that you need all 3 conditions met for a fraud to have taken place, could just have been the broker, or the bank or the borrower that thats caused the fraud.

For all of them to get away with it on a grand scale you need absolute complicity by all parties.

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Ten Bear Market Phases

1. A huge buy the dip mentality sets in during the initial decline. Most party goers cannot fathom that party has ended.

2. Moderate concern sets in when buy the dip stops working.

3. Initial panic.

4. Numerous bottom calls are made, all wrong.

5. Search for the guilty.

6. Punishment of the innocent.

7. More panic.

8. Lawsuits fly.

9. Regulatory power is given to those most responsible for spiking the punch bowl.

10. Congress gets in the act and makes things worse

Steps 4-10 are repetitive, may overlap, and may occur in any order during repetition. Certainly there have been numerous bottom calls for months now, but each rally has failed.

Oh well, we've reached stage 5 & 9. Financial Planner can expect to be clapped in irons shortly! ;)

Edited by Radge

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For all of them to get away with it on a grand scale you need absolute complicity by all parties.

100% agreed.

What I am thinking of is the poor black family, on benefits, that given a huge loan with teaser rates and the broker, or whatever, "sold" it to them as an affordable deal.

yes, the family could be complicit, but the hard sell of some of these guys has to be seen to be beleived (recent TV docs and newspaper stories).

OK the poor family signed on the line, but how much were they blinded by the suits, the cheap money and the rest of the parts of the scammers arsenal?

Shame if the family cant be helped with the scheme, and they have to wait till the criminal justice system winds round to their case.

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Unlike the common man who gets two years for stealing a tin of beans to put food on the table for his family, how many of these money saltering b"$tards are actually going to be caught? And will the missing trillions ever be recovered? Don't think so. Those investigating, are those who have been pillaging. The safe is empty. The thief has left the building. We don't even have a clear fingerprint to go on said a spokesman for the FSA, however, we are currently working on a bullsh!t story which we think may be acceptable to the sheeple.

Drug dealers get their assets seized, and long sentences. What's the difference here?

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good points and where would they/the fraud sqaud draw the line, exaggerating income, or inventing multiple IDs? in the 70's/80's it was time comsuming and difficult to weed out those ahead of the game. Not now, there is nail on bullet prrof ways all lenders could have protected themselves and the CML know it. Lenders were not interested from 2005 onwards in rejecting anyone with a pulse and a false passport, and there is more than anecdotal evidence in the industry of stiffs getting mortgages, BTL covered a massive amount of wounds; in effect a business loan that required no proof of income or a plan. We'll get a few scapegoats, not in the city or wall street though... <_<

Sadly very true.

A few small time brokers or individuals will be thrown to the baying crowd to satisfy the blood lust and protect the big players.

Given the number of individuals involved in the lending industry and the relative simplicity of checking factual earnings, employment, identities etc, property details etc it is clear to me the guilty parties are mostly the one's lending other people's money. If they want to avoid "fraud" it would be relatively simple. They encouraged it, facilitated it, designed "products" specifically aimed at it and earned huge salaries, bonuses and pensions from it. A huge industrial scale conspiracy to defraud millions of people of interest on outsized loans for much of their working lives. Worse than any previous financial scandal imo.

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I think it took longer to open a checking account in 2007 than to open a mortgage account with £200K through a broker.

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CML Director General Michael Coogan commented:

"The FSA rightly identifies that the best way to tackle distance ourselves from mortgage fraud is for lenders and the regulator to work together, along with law enforcement agencies, to root out fraudsters.

http://firstrung.co.uk/articles.asp?pageid...&cat=44-0-0

Ahh yes, Coogan. Why do that creature's statements have a special effect on me.... <_<

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Sadly very true.

A few small time brokers or individuals will be thrown to the baying crowd to satisfy the blood lust and protect the big players.

Given the number of individuals involved in the lending industry and the relative simplicity of checking factual earnings, employment, identities etc, property details etc it is clear to me the guilty parties are mostly the one's lending other people's money. If they want to avoid "fraud" it would be relatively simple. They encouraged it, facilitated it, designed "products" specifically aimed at it and earned huge salaries, bonuses and pensions from it. A huge industrial scale conspiracy to defraud millions of people of interest on outsized loans for much of their working lives. Worse than any previous financial scandal imo.

spot on. B)

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Anyone who is chased into court by the FSA or CML should just play these 2 video tapes -- each only about half an hour long --- and it will become clear that no one wanted to know during the "good times" --- and indeed, Coogan at the CML positively DENIED that there was any problem at all!!!!!

http://video.google.co.uk/videoplay?docid=...75&hl=en-GB - This was in 2003/3!!!!!!!!!!!

And it is STILL going on in May 2008!!!!!!!!

http://video.news.sky.com/skynews/video/?&...270508_0900.flv

Don't tell me the FSA and CML didn't know about this MASSIVE fraud!?!?!? :P:P

Edited by eric pebble

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Anyone who is chased into court by the FSA or CML should just play these 2 video tapes -- each only about half an hour long --- and it will become clear that no one wanted to know during the "good times" --- and indeed, Coogan at the CML positively DENIED that there was any problem at all!!!!!

http://video.google.co.uk/videoplay?docid=...75&hl=en-GB - 2003!!!!!!!!!!!

http://video.news.sky.com/skynews/video/?&...270508_0900.flv -- And STILL going on in May 2008!!!!!!!!

Don't tell me the FSA and CML didn't know about this MASSIVE fraud!?!?!? :P:P

That would be mitigation, but just because the police dont prosecute every litter lout, doesnt mean you wont get fined if YOU are caught.

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That would be mitigation, but just because the police dont prosecute every litter lout, doesnt mean you wont get fined if YOU are caught.

I agree. The Darwins were about to become bankrupt when they pulled their rather modest £250k scam.

How is a preson CHOOSING to buy a house any different?

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That would be mitigation, but just because the police dont prosecute every litter lout, doesnt mean you wont get fined if YOU are caught.

Yes -- I agree with you 100% --- but to hear the FSA and CML pleading ignorance -- it beggars belief......... They are JUST AS culpable......... Yes -- the people who lied are plainly idiots...... But the CML/FSA just CANNOT pretend they didn't know. The BBC Money Programme gathered that evidence -- and plonked it on their desks!!!

http://video.google.co.uk/videoplay?docid=...75&hl=en-GB

They just totally ignored it -- and The Money Programme had done all the investigative work without it costing them [the FSA &/CML] a dime!!!

Edited by eric pebble

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  • 395 Brexit, House prices and Summer 2020

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      • down 5% +
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