Larry Barreto and Tassib Hussain were sentenced for fraud offences after a prosecution brought by the Financial Conduct Authority (FCA).
The regulator began criminal proceedings against the two in April 2021, and they were found guilty in November last year.
On 27 March, Barreto was sentenced to two years in prison, suspended for two years, with 120 hours of unpaid work. He was convicted for 11 counts of fraud by false representation and two counts of carrying on regulated activities without authorisation.
Hussain was sentenced to 16 months in prison, also suspended for two years, with 120 hours of unpaid work, for one count of fraud by false representation relating to 11 mortgage applications.
False employment information
The charges related to activity between 1 January 2015 and March 2018, where Barreto gave residential mortgage advice in return for a fee without the correct FCA authorisation.
In 11 cases, he overstated the applicant’s income in their application.
Barreto would then pay Hussain, who created false self-employment and employment documentation to support the inflated income for applicants whose earnings were insufficient for the loan.
Hussain created fake HMRC documents with false income figures, which were then sent to the lender by Barreto.
With Barreto’s knowledge, Hussain also claimed to be the employer of two applicants and produced false contracts of employment and payslips, which were sent to lenders by Barreto.
This resulted in lenders giving applicants mortgages on a false basis, which put both the lenders and borrowers at risk of financial loss. The value of the mortgages applied for was roughly £3m.
Judge Cole at Southwark Crown Court said Barreto and Hussain were “guilty of systematic mortgage fraud” and have “abused your position… it ruins the integrity of the system to have dishonest players in it”.
Therese Chambers, joint executive director of enforcement and market oversight, said: “Larry Barreto and Tassib Hussain chose a selfish path in pursuit of their own greed. Their dishonesty unnecessarily put people at risk of taking out unaffordable loans and losing their homes.
“Their offending also undermined the reputation of the industry, and the legitimate advisers that work in it.”
She added: “The sentences should send a clear signal of the lengths we and the courts will go to catch and prosecute those who commit such acts of dishonesty. And for Mr Barreto and Mr Hussain, the consequences of their offending will have far-reaching impacts for them beyond their sentences.”
The FCA has begun confiscation proceedings to recover the considerable financial benefit obtained by the defendants.
