Larry Barreto ran the unauthorised financial services firm Barreto and Partners while Tassib Hussain is a chartered accountant who ran Keystone Chartered Accountants. Both were based in Nottingham.
Barreto pleaded guilty to two offences of arranging and advising on regulated mortgages without FCA authorisation last year. Today, he was found guilty of 11 charges of fraud by false representation.
At the beginning of the trial on 23 October, Hussain pleaded guilty to fraud by false representation.
The charges related to activity between 1 January 2015 and March 2018, where Barreto advised clients seeking residential mortgages without FCA authorisation. In 11 instances, he dishonestly inflated the applicant’s income.
Barreto charged the client a fee which was then paid in cash to Hussain who created false self-employment and employment documentation to support the income stated.
Hussain also produced documents which were claimed to have been issued by the HMRC which included false income figures. These were sent to the lender by Barreto.
Additionally, Hussain falsely claimed to employ two applicants with Barreto’s knowledge and produced false contracts of employment and payslips as evidence of their income. Barreto also sent this to lenders.
In 1996, Barreto was struck off as a financial adviser by the Personal Investment Authority and prohibited from carrying on regulated activity by the FCA in 2004.
Barreto and Hussain will be sentenced on 23 February 2024.
Steve Smart, joint executive director of enforcement and market oversight at the FCA, said: “Mr Barreto and Mr Hussain knowingly lied and misled their clients and mortgage providers in order to benefit financially from mortgage applications. This put borrowers at risk of taking on unsustainable levels of debt, and left lenders open to losses.
“Today’s verdict demonstrates our commitment to tackling fraud and sends a warning to anyone involved in similar criminal activities that we will pursue them, so they face the full force of the law.”
