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Mortgage fraud not a priority for police, says BSA

Mortgage fraud and other business crime is not a top priority for police forces, says the Building Societies Association.

In the Spring edition of its e-newsletter, Mortgage Matters, the trade body says the major budget cuts announced in 2010 will hit police capacity and capability to investigate fraud.

It says a chief constable with a budget under pressure might consider that compared to combating street crime, violent crime or anti social behaviour, investing in combating fraud offers a low return.

The BSA says a key theme for the anti-fraud community in 2011 will be how to fund specialist police mortgage fraud investigators and work better together to make the most of the capability that it does already have.

The trade body says Professional Indemnity insurers will also have strong concerns about the potential scale of claims from lenders given the reduction of resources for criminal prosecution.

Many small professional firms – solicitors in particular – are struggling to find affordable PI insurance, without which they cannot be in practice.

In its newsletter, the BSA says: “Mortgage lenders have become the pantomime villain for many small solicitors as they have rationalised panels following a spate of major mergers but the reasons for high PI premiums are very complex.

“The professional indemnity situation for small firms of solicitors and other professionals will be a huge hurdle in 2011 and is not something for the mortgage industry to interfere in.

“But lenders will want to make sure that they still have operational flexibility in running their professional panels and that a civil route to recover damages is still available.”

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  • Dennis Jason 23rd February 2011 at 1:22 pm

    The credit card industry has paid for the setting up and financing of a specialist unit within (I think) the City of London police to pursue fraudsters in the credit card world. The rationale for that is that card fraud is not a priority for individual forces – but it’s worth the industry paying to get additional resource. Isn’t it time the mortgage industry did the same – knowing that an industry is policed with a dedicated, expert resource will act as a great deterrent to fraudsters.

  • Dennis Jason 23rd February 2011 at 1:22 pm

    The credit card industry has paid for the setting up and financing of a specialist unit within (I think) the City of London police to pursue fraudsters in the credit card world. The rationale for that is that card fraud is not a priority for individual forces – but it’s worth the industry paying to get additional resource. Isn’t it time the mortgage industry did the same – knowing that an industry is policed with a dedicated, expert resource will act as a great deterrent to fraudsters.