We have to be honest here and say that over the course of the last three to six months, we have seen a noticeable uptick in the number of false documents that are being passed to us in order to support a case/application.
That appears to be the case for other lenders as well and it’s therefore imperative that advisers are vigilant, particularly in the buy-to-let space, when it comes to dealing with applicants and cases which may not be all they are cracked up to be.
Just recently, our credit director, Diane Mitchell, shared with the sales team a presentation on some of the documents that have been passed to us via advisers under the suggestion they are ‘legit’.
While some of these fraudulent pay slips, bank statements, etc are what we might call incredibly good copies which need some considerable forensic work in order to determine them as fakes, there are others for which it’s possible to see less things ‘right’ with them than ‘wrong’.
And in those cases, we would certainly expect an adviser to be able to sort the document wheat from the chaff, before they ever get sent to us.
Implications for advisers
Why is this important? Well, for a start, fraudulent mortgages have the potential to cause significant financial distress to many parties, but there’s also the point to make about what it could mean for an adviser’s livelihood.
Let’s make no bones about this, even if the fake documents sent to us are of the very highest ‘quality’, there will be implications for the adviser concerned.
For a start, it may well result in a warning to the adviser, and if we did receive any more then – regardless of how convincing they are – it’s going to mean we will consider having to remove that adviser from our panel.
This sort of information is also shared amongst the lending community, so you can imagine how this might be viewed by others who the adviser might try to work with.
For network members, the stakes might be even higher. Many networks require an adviser to have a full panel, and therefore being taken off by one lender, could result in them putting their status as a network member at risk. The further consequences of this are obvious in terms of their ability to keep on providing mortgage advice.
We have one case at the moment, where a network member has been suspended, however the adviser is telling us that the fake documents came direct from the client, whereas the client is saying the documents were doctored by the adviser before being sent on to us. They are effectively blaming each other and the network are currently helping us look into the real facts of the case.
It won’t need me to tell experienced advisers the dangers inherent in letting one less-than-satisfactory document come through to a lender, and there needs to be an absolute zero tolerance policy when it comes to this type of thing. If in doubt, don’t send.
Indeed, you too might be seeing more attempts at attempted fraud, because of the economic situation some people might find themselves in.
Watch this one area
One area to be particularly vigilant on is unencumbered properties where the ‘client(s)’ are trying to raise significant amounts by mortgaging the property. We have again seen an increase in cases where people are trying to commit fraud in order to secure the cash, and again it might leave an adviser guilty by association if these attempts end up with us as attempted cases.
For the vast majority of advisers, this will seem like I’m teaching you to suck eggs. However, please be aware of what is going on, the increase in the number of fraud attempts, and if you’d like further information, our sales team will be able to share with you some of the issues we have come up against recently.
The priority here is to make sure everyone is both vigilant and protected.
