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Money laundering rules make self-cert deals impossible

Thank you for your feature on self-cert mortgages (Mortgage Strategy September 1). Nevertheless, I think it missed a major point that has been the subject of a conspiracy of silence in the trade press.

I refer to the fact that money laundering laws now require brokers to report clients suspected of concealing income from the taxman.

In this light, I cannot see how we can continue to self-certify clients who have been in business for years.

For instance, in my own case I could self-certify my income as £38,000 where-as my accountant would indicate I earned about £33,000. But with allowable expenses I am as well off as an employee earning £38,000.

The only circumstances I can see when one should use self-cert are when there has been a change in the basis of a business, a new business has been founded or there’s an urgent need for a facility. These reasons do not apply to many self-employed borrowers.

As brokers we are in a uniquely vulnerable position and cannot hide behind clients’ accountants.

Our way of working requires us to have on file the amount of bacon clients bring home for affordability purposes as well as either tax figures or accounts proving we could not source them full status mortgages.

We all know industries where the figures declared for tax are miles away from the gross sums consumers take home every week.

I have no problem reporting most types of crime but although I dislike tax avoidance intensely, fiddled income returns do not cost lives.

We also have MPs and ministers who are ripping us off left, right and centre, carrying out badly publicised last-minute changes to legislation to ensure that even non-domiciled consumers who did not qualify to buy out their obligations to the Inland Revenue can do so now. What kind of example are they setting to the public?

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