It may be an after-effect of the credit crunch but the property industry is increasingly focussing on the problem of mortgage fraud.
One strange thing is the lack of input brokers have in the fight against fraud. For lenders, the key strategy for dealing with it has to be to know their customers.
But this means knowing their partners too – who is writing what business and who the client’s legal representative is.
Lenders need to understand the relationships between all players in the chain, including brokers.
Lenders have rightly taken a risk-based approach to knowing their customers and partners. And brokers will be conscious that networks are consolidating, with reduced volumes making it easier for lenders to manage their relationships. In the conveyancing sector too, lenders have embarked on panel rationalisation.
But brokers represent an untapped resource in identifying and preventing fraud. Due to their early contact with consumers they know them better than anyone.
I know brokers are keen to get involved in the fight against fraud and understand the value they could bring to lenders but I’m unaware of any involvement from them in initiatives such as the National Fraud Authority’s Mortgage Fraud Forum.
Lenders have the electronic tools to deal with of fraud but to make the most of these they must bring all the professionals involved in the property chain together.