£7m mortgage scam rocks Midlands

A number of lenders and mortgage brokers in the West Midlands are reported to have fallen victim to a £7m mortgage scam.

The perpetrators are thought to be a group of solicitors based in East London who in one instance managed to con almost £600,000 from an unsuspecting broker.

Birmingham-based newspaper the Sunday Mercury reported on Sunday that pensioner Barbara Moody had her £750,000 Birmingham home refinanced by the fraudster without her knowledge. BM Solutions is reported to be one of the lenders caught up in the scam.

A spokeswoman for BM Solutions says that although the Barbara Moody case was not connected with the lender, it could not rule out that it had been part of a larger scale scam.

She says: “Without having detailed information on particular cases we cannot say whether we were involved or not.”

The Metropolitan Police are now investigating the fraud. A spokesman for the Met would not confirm whether it was investigating an alleged mortgage scam.

He says: “I can confirm that we are investigating an alleged fraud involving a company based in East London.”

The news comes as research by Credit Industry Fraud Avoidance shows that the number of fraud applications approved in the UK has more than doubled.

In 2004 CIFAS says it found 7,200 cases where fraudulent applications were successful in obtaining an insurance policy or credit agreement.

By 2007, the number of successful fraudulent applications had rocketed to a whopping 14,500.