Spending cuts may hit mortgage fraud probes

Several figures in the mortgage market have raised concerns about the effect government budget cuts may have on the police’s capacity to investigate mortgage fraud.

In its Mortgage Matters newsletter last week, the Building Societies Association claimed mortgage fraud is no longer a top priority for the police.

It says a chief constable might consider that compared with combating street crime or antisocial behaviour, investing in combating fraud offers a low return.

John Malone, executive chairman of PMS and brokers’ rep-resentative on the National Fraud Authority’s mortgage fraud forum, agrees budget cuts will affect the police’s capacity to deal with this type of crime.

He says: “The news that a number of large police forces may be reining back on their involvement in detecting mortgage fraud sends out a bad message.

“Bearing in mind all the work that has been done by police forces in bringing fraudsters to court, the industry recognises the importance of stamping out mortgage fraud.”

Jonathan Smithers, partner at CooperBurnett Solicitors and vice-chair of the Law Society Conveyancing and Land Law Committee, says: “Everybody would be concerned if the police was not putting resources into investigating fraud.”

But a spokeswoman for the Serious Fraud Office, says it expects no reduction in its frontline capability to maintain its casework.

She says: “Savings will be made elsewhere through, among other things, more use of shared services, smarter technology, regular reviews of use of external resources and accommodation cost reductions.”