FSA issues broker warning over property hijacking
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The Financial Services Authority is warning mortgage brokers to be wary of property hijacking.
The regulator reports it has seen an increase in cases where fraudsters are trying to obtain mortgages on empty properties they do not own, which it dubs property hijacking.
The fraud is perpetrated by out of area introducers that are unknown to brokers introducing business to them.
In its smaller firms regulation round-up for April the FSA states: “These have been attempts by fraudsters to raise mortgages on unencumbered properties which they do not own - property hijacking.
“This demonstrates the importance of undertaking appropriate due diligence when engaging in new relationships, to ensure that you know who you are dealing with and can identify any trends or anomalies in the business being offered.”
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Readers' comments (9)
Mike | 27 Apr 2012 10:59 am
It seems that brokers are the brick-bat for everything wrong in financial services when this is patently not so. Surely our job is to obtain the finance with due dilligence but the final legal position is with the solicitors. What do they get paid for? Surely they check title, ownership etc?
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Roger Travis | 27 Apr 2012 11:12 am
I assume this type of fraud has been going on for as some lenders now ask their appointed Solicitor for paper ID in additional to electronic ID. Why then, has it taken so long for us to be made aware of it. Surely, if we are told about this its a lot easier to spot?
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Des Platt | 27 Apr 2012 11:17 am
Loved the headline. I know things are desperate but it brought an image to mind of brokers holding clients hostage to get them to not go direct!
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Lars | 27 Apr 2012 12:39 pm
Mike,
Surely this is a warning to brokers to be on their guard, rather than a blame exercise
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Chris Hulme | 27 Apr 2012 1:36 pm
Why is this a warning seemingly just to brokers? Why isnt this a warning to solicitors, lenders, estate agents, valuers, networks AND brokers?
We're all in this market and all have contact with clients and we all have a duty to keep our eyes peeled - afterall, the penalties just for being a broker seem to sky rocket day by day - who needs any more grief?
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Robert Sinclair | 27 Apr 2012 3:03 pm
The warning here is about introduced business and a recent trend in some brokers allowing people they do not know or do not know well to channel business through them. It is a big risk to allow someone to do this, as you may lose your livelihood for a share of one proc fee.
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Glen McKeown | 1 May 2012 3:51 pm
The FSA have a penchant for silly language. This is straightforward fraud - call it that.
The problem that the FSA have is that they applied the word Fraud previously in a totally inappropriate manner and now they have to distinguish to two processes.
Property Hi-Jacking! I really can't think of a more inappropriate description from a more inappropriate organisation.
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Chris Gardner | 1 May 2012 5:08 pm
Complete gutter press, jingoistic langauge from the FSA. Quite pathtetic really. Also, its wrong. Here is the correct definition:
hi·jack/'hi?jak/
Verb:
Illegally seize (an aircraft, ship, or vehicle) in transit and force it to go to a different destination or use it for one's own purposes.
Noun:
An incident or act of hijacking.
Synonyms:
verb. kidnap - abduct - ravish
noun. hijacking
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Doctor S P | 2 May 2012 10:31 am
@ Glen/Chris
The FSA didn't make the definition up, so you can stop your usual boring FSA bashing.
And heaven forbid that they try to warn you guys about a possible fraud MO... Oh my god, what an utter bunch of swines they are!!!
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