The FSA has banned six individuals, and fined one of them over £130,000, for mortgage fraud-related failings.
The regulator found that all lacked honesty and integrity, most had committed mortgage fraud by providing false or misleading details in mortgage applications, and a number had deliberately obstructed its investigations.
These actions bring the total number of mortgage brokers banned to 91. All of these cases stem from work that was originally conducted by the FSA’s Small Firms and Contact Division.
<b>Neale Morton, Syed Meah and Jonathan Smith of Neale Morton IMS Limited</b>
Three of the individuals banned all worked for one firm, Neale Morton IMS Limited (IMS), based in Gateshead, Tyne and Wear.
Neale Morton was the principal and director of IMS. The FSA has prohibited and fined him £130,192 for knowing involvement in mortgage fraud and for systems and controls failings at IMS for which he was personally culpable. Part of the fine, £5,192, represents a disgorgement of the profit he made from the fraudulent mortgage applications.
Morton not only submitted mortgage applications for himself that used false income details, but he also allowed his firm to be used for mortgage fraud by its advisers and customers.
During the investigation Morton failed to deal with the FSA in an open co-operative way by failing to disclose relevant information. Morton referred the case to the Financial Services and Markets Tribunal but his reference was subsequently struck out.
Two advisers at IMS, Jonathan Smith and Syed Meah, have also been banned. Both produced falsified compliance documents during the FSA’s investigation. Smith also submitted falsified mortgage applications to lenders on behalf of the firm’s customers and Meah did not notify the FSA that he had been arrested on suspicion of money laundering and had, as a result, been suspended as a mortgage adviser at IMS.
In an interview with the FSA, Smith estimated that approximately 5% of the mortgage business he submitted while at IMS was “crooked””.