Property investors and professionals such as surveyors, mortgage brokers, financial advisors, accountants and solicitors can be targeted in criminal proceedings.
Many of these people will never have been charged with a criminal offence before and it is vital to preserve their good name.
Mortgage fraud can cover a number of offences such as giving false details as to income, liabilities and the value of the property to encourage a lender to lend money. It is different to most fraud because here the only thing obtained is a debt. There are significant advantages in doing this and that is why it is recognised as a criminal offence. It is estimated that 43 out of every 1000 mortgage application is fraudulent.
The offence can be committed in a number of ways. It can be said that you made misrepresentations on the form such as overstating your income with false payslips, inflating the value of the property or where the whole identity of the applicant is false. It is also an offence to make an application for a mortgage on the basis that it is for owner occupation when you intend to rent it out.
More professional mortgage frauds often relate to registration fraud. This is where the land registry details are changed so that the property appears to be registered to an identity used by someone to commit mortgage fraud. This enables someone to take out mortgages on that property.
The offence can be committed by failing to disclose information such as the existence of an illness which might affect your ability to pay the mortgage.
The law changed in 2006 with the Fraud Act. Previously the prosecution had to prove that the deception had induced the lender to make the loan. Now they don’t have to prove that. So even if the misrepresentation made no difference to the lenders decision it is still an offence. The prosecution do not have to prove that there was an actual loss just that there was a risk of economic prejudice. The prosecution still have to prove that you were dishonest but it is not a defence to say that you were confident that the mortgage would be repaid because house prices were rising.
Many people facing these charges are professionals who have had no dealings with the law. Often they are duped into this offence by more sophisticated offenders taking advantage of them. Professionals such as Bank Managers may be induced to collude or turn a blind eye to false applications in return for commission or even payment directly from the applicant. Mortgage Brokers are often caught up in this, they are pivotal to applications and are in a position to falsely vouch for applicants. Sometimes brokers are innocently dragged into this because the applicant blames the broker for false information provided. Accountants can be caught up by providing false information as to income.
Solicitors are in a difficult position because they will report to the lender and may provide false information. The question then is whether they were simply passing on information provided by the applicant. It is important to be able to show that the solicitor followed the correct guidelines and undertook the correct checks.
Finally surveyors are often caught up in this by providing an inflated value or commercial viability of the property. Once again the key element is dishonesty and the degree to which the value has been inflated.
The courts will use the published sentencing guidelines, the most important factor is the amount of money involved. In Mortgage Fraud it includes actual loss and risk of loss. Where there is a risk of loss but no actual loss then this is treated less seriously and the courts are advised to move down a category in sentencing. A prison sentence is highly probable for one of these type of offences, only the least serious in terms of amount of money involved and your involvement will mean a prison sentence can be avoided.
HOW WE CAN HELP
As Mortgage Fraud Solicitors we see a lot of people charged with these offences that are victims themselves, you may have suffered financially as a result of this, you will almost certainly have suffered emotional stress. There may be a lot of people charged at the same time and it is important that we ensure the court understand your role in this and if you had a minor role and were duped into that then we will make sure the court see your side of the story.
You may feel more naive than guilty but the law won’t necessarily see it that way. It is important to get professional advice as soon as possible. Sometimes the case can be won or lost at the very beginning.
We understand how worrying this is for you and will do all we can to support you through this. We will not be judgmental and will look at your side of the story, we appreciate that it can appear that no one is listening to your side of the story. We will be on your side totally and will guarantee that you will receive good, personal service at all times.
Call us on 01623 397200 for free initial advice