FSA to act on mortgage fraud

The Financial Services Authority (FSA) has told lenders to step up their defences against mortgage fraud.

So far this year it has banned or fined 17 mortgage brokers who have been implicated in making actual or potentially fraudulent applications.

The regulator says it is targeting 200 more broking firms to ensure they have sufficient checks in place.

And it warns that some lenders may not be guarding themselves against fraud with sufficient diligence.

"The FSA continues to take very seriously the question of whether lenders' systems and controls for dealing with mortgage fraud are proportionate to the risk," said Philip Robinson, director of the FSA's financial crime and intelligence division.

"We are likely to take particular note of cases where weaknesses in due diligence and customer checks - or in outsourced relationships with third parties - may have contributed to a heightened mortgage fraud risk," he warned.

 

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