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Networks on guard after attempt to steal proc fees

Networks are on high alert against fraudsters after attempts were made last week to scam them out of brokers’ proc fee payments.

Several networks are believed to have been targeted by fraudsters who posed as members of their finance departments and contacted lenders to try to get proc fees paid direct to them and not the network’s usual bank account.

Mortgage Strategy understands no networks were duped by the fraudsters who hit during the same week as Cheltenham Races, when many company directors were out of the office.

John Malone, who represents brokers on the National Fraud Authority’s Mortgage Fraud Forum, says the fraudsters targeted a number of the big networks.

He says: “The fraudsters chose a good time to hit as many people would have been at Cheltenham and distracted. You hope the lender checked with the network that the request was genuine.

“Can you imagine the thousands of pounds that would have been paid to fraudsters if they had been successful? Brokers would have lost faith in their networks and it would have damaged the industry.”

Meanwhile, Abbey for Intermediaries revealed last week that fraudsters had tried to hack into its system and impersonate brokers.

Although the lender’s systems detected the activity, it has advised brokers to check if their personal information is correct on the lender’s intranet and ensure no new application submissions have been tampered with.

Abbey could not confirm how many hacking attempts were detected, but advised brokers to report any suspicious activity.

Mark Blackwell, managing director of xit2, says that infiltrating lenders’ systems is no mean feat.

He says: “If a broker is passing on their access details to somebody, that would make it easy for them to get into lenders’ systems.

“But if fraudsters are trying to hack into the system and inputting details into it, that would be hard to do and I imagine a lender such as Abbey would have fairly rigorous controls around that.”

Last week the Financial Services Authority claimed that the Mortgage Market Review would lower fraud because lenders will be responsible for carrying out more checks on mortgage applications.

Giving evidence on the MMR, Martin Wheatley, managing director of the conduct business unit at the FSA, told the Treasury Select Committee: “In the past lenders relied on third parties and agents to carry out checks.

“We are now putting the obligation back on to lenders and that should allow them to carry out better checks against potential fraud.”

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  • Tom Cleary 19th March 2012 at 11:56 am

    Is this story real? I had to check my calendar to make sure it wasn’t April the 1st! Anyone with a basic knowledge of the mortgage market will know that you can’t just ring a lender and ask them to change your payment route! Are these criminals complete idiots? And as for John Malone’s comment that the industry would have been off guard due to the Cheltenham festival is as funny as it is scary…