One particular area we are seeing is where applicants have changed their names in order to hide a past.
This past could be related to being removed from one or more past lender panels or in one case the applicant was trying to hide that they had actually been to prison for mortgage fraud. The issue is that when someone chooses to change their name by say Deed Poll there is no official register for this. Depending on the time that has passed since the name change, they may be able to supply a range of genuine documents in their new name, leaving many none the wiser.
So why could this also be a risk for mortgage brokers?
Providing fraudulent documents
There is a risk on two fronts.
The first is that many mortgage brokers have introducers of business. Without completing due diligence on those introducers they may find themselves unknowingly dealing with applications from clients who have been coached by the introducer with areas such as ‘back door residential’. Or in some cases, the introducer has helped the client to obtain fraudulent documentation such as payslips and bank statements.
The second, and one of the increasing areas of fraud is the remortgage of an unencumbered property that is tenanted. The tenant changes their name to the legal owner of the property and then updates their official documents to match the name change. After a few months, they have the official paperwork needed to apply for a remortgage on the property, by impersonating the true owner.
How to protect yourself
So what can a broker do to try to identify these types of fraud?
While brokers do not have access to some of the sophisticated tools available to lenders, there are a lot of tools available to brokers for free or minimal cost. It is important to do a range of checks and look at how these add up. For example, 192.com can check the electoral roll to see who has registered at the subject property and when. Mouseprice can help you see the date and price paid for the property, and when it has been marketed for sale or rent. Companies House can help you identify any undisclosed companies and directorships. Asking for full documentation including a credit check is also important.
When you gather your client’s fact find information or ask an introducer to complete an application form, does the information you have been given match the documents and the information you have found through your checks? If you raise questions, do the answers seem feasible?
Often there is not one big area that shows as an issue, but lots of little anomalies that don’t seem to make sense. Google is another very good tool to find information.
In combination with this and some identity-related issues, we recently uncovered an applicant who was hiding very close family links to someone who appeared to still be wanted for questioning related to armed robbery. Brokers that take the risk seriously can adopt checks and processes that will help them protect their businesses for many years to come.