The Financial Services Authority (FSA) has banned five (5) mortgage intermediaries, and fined another one in the amount of £104,000. There are now 101 mortgage intermediaries banned by FSA since December 2006.
Most of the individuals that have been banned were declared to be not fit to work in regulated financial services through failings that led to mortgage fraud.
The 5 banned by FSA are:
- Mark Thorogood, trading as Property Park Mortgages, Colwyn Bay, North Wales
- Darren Button, formerly of Property Park Mortgages, Colwyn Bay, North Wales
- Daniel Djaba, trading as DPD Consultancy Services, London
- Adeolu Adeosun, formerly of DPD Consultancy Services , London
Mark Thorogood, the owner of Property Park Mortgages, has been fined £104,294 and banned from working in regulated financial services. The FSA found that Thorogood had knowingly submitted fraudulent mortgage applications for himself and his wife, inflating his income from £22,950 to £120,000 and her income from £8,832 to £95,000. He also submitted two mortgage applications containing fraudulent information on behalf of a family member. In the first application he stated the family member’s income was £85,000 and in the second he stated that it was £130,000; the actual income was £17,610.90. Lastly, he failed to have a documented system for supervising the activities of advisors at the firm.
Darren Button, a former advisor at the firm, was found to have deliberately entered false income and employment information in mortgage applications which he then submitted to lenders. He also attempted to conceal a customer’s true income on a payslip with correction fluid because he knew the lender would reject the application if they saw the genuine income. He was also aware of other fraudulent applications but took no action to prevent this as he thought “it didn’t seem to be a huge problem.”
Daniel Djaba, trading as DPD Consultancy Services (DPD), has been banned from performing a significant influence function in regulated financial services. He failed to have appropriate systems and controls in place at DPD, and therefore failed to prevent the firm being used to commit mortgage fraud. She also failed to ensure DPD gathered robust documentary evidence to support income declared by customers and submitted two applications for customers that contained misleading information.
The FSA has also prohibited Adeolu Adeosun, a former advisor at DPD, for knowingly submitting fraudulent mortgage applications for himself and intentionally misleading the FSA during an interview. Adeosun was a self-employed advisor who provided mortgage advice to DPD’s customers. However, he was not qualified to give advice, nor had he been assessed to be a competent advisor by DPD. In a residential mortgage application for himself in April 2008 Adeosun inflated his income for 2006 by more than eight times from £7,826 to £66,022. In a buy-to-let application for himself in 2007 Adeosun again misleadingly used gross income figures rather than net. Adeosun also misled the FSA in an interview by not telling the truth about when he stopped working for an employer.
Waheed Hanif was a sole trader at The Broker Group, conducting mortgage mediation business. He has been banned for acting dishonestly and lacking integrity. In November 2009 Hanif was convicted by Stafford Crown Court of one count of obtaining a pecuniary advantage for another by deception and one count of obtaining a money transfer by deception. Hanif had submitted false information in his application for FSA authorisation and a false mortgage application to a lender in his own name.
Mortgage Intermediaries Banned
Since the FSA began investigating intermediaries in the mortgage sector in mid 2005, it has banned 101 intermediaries. Many of these operated in London and the South East, but the FSA has taken action against mortgage intermediaries all around the United Kingdom.
- London & South East – 53 prohibitions
- North West & Wales – 20 prohibitions
- North East – 10 prohibitions
- Midlands – six prohibitions
- South & South West – six prohibitions
- Northern Ireland – four prohibitions
- Scotland – two prohibitions
Ninety five of the 101 individuals were prohibited for failings in relation to mortgage fraud. The other six’s failings included: lying to the FSA, failing to take reasonable steps to prevent their businesses from being used to commit mortgage fraud, and a serious lack of competence and capability to run an FSA-authorised firm.
Many of the 101 were fined as well as banned, with total fines amounting to £2.5 million; the biggest single fine imposed was £294,500 for a combination of mortgage and life insurance fraud.