View more on these topics

FSA bans three more mortgage brokers

The FSA has banned three mortgage brokers and fined two of them £294,500 and £120,000 for fraud. 

Kent based mortgage and general insurance intermediary director John Charalambous was fined £294,500 for taking part of a customer’s mortgage advance and for attempting to defraud life insurance companies.

He advised a customer to remortgage their property to raise additional money for a new property, increasing the amount of the loan on the mortgage application without the customer’s knowledge or approval, and arranging to receive the excess amount into his own bank account.  He then wrote the customer cheques which he was fully aware would bounce and continues to owe the customer £44,500. 

He also set up life insurance policies in the name of customers without their knowledge to obtain commission and applied for other false life insurance policies in an attempt to obtain commission payments.

In March 2009 the FSA released a statement warning consumers about Charalambous. It told anyone who had taken out a mortgage with him to check that the advance he had applied for was the same amount they had requested in their initial application.

Richard Granville Greenland of Kent mortgage broker Guardian was banned and fined £120,000 for knowing involvement in mortgage fraud and failing to ensure the firm had appropriate systems and controls.

The FSA also banned Michael Adam Goldman of Manchester based mortgage and insurance intermediary Goldman Group for submitting a fraudulent application for himself in 2007 and submitting fraudulent mortgages for three closely related clients.

Goldman substantially inflated both his own and his clients’ income in order to obtain fraudulent mortgages.  He would have also been fined £102,158 had he not been declared bankrupt in November 2009. 

The FSA’s latest actions bring the total number of mortgage brokers banned to 91.

FSA director of enforcement and financial crime Margaret Cole says: “We take mortgage fraud very seriously, particularly when customers suffer or are financially at risk.  All three individuals have demonstrated a serious lack of integrity and we regard it as even more serious when those in senior roles and who are trusted by the customers abuse their positions. 

“We expect this tough action to deter others from conducting themselves in this way.”

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

There are 10 comments at the moment, we would love to hear your opinion too.

  1. “All three individuals have demonstrated a serious lack of integrity and we regard it as even more serious when those in senior roles and who are trusted by the customers abuse their positions.”

    Good to know they have banned 91 brokers! It’s us brokers not the major banking institutions that brought to our knees! Good to see all the enforcement action going on at the banks, oh wait………..

  2. Sounds like the sort of think baners get up to but they don’t receive the same treatment do they?

    The FSA is very good at catching the stupid ones, the ones who are cleverer, or wealthier, than the regulators will more often than not escape scrutiny, that is the way of the world.

  3. another day, another crook (or 3), hard to be proud to be in this industry sometimes

  4. Dermot Brannigan 16th June 2010 at 11:13 am

    Surely life never gets this bad that you have to resort to this sort of thing, does it? And why not just go and get another job?
    Well done FSA for getting rid of these people.

    But how do you ‘arrange to have excess funds paid to your own bank account’ on a remortgage? Perhaps its best I don’t know how you do that.

  5. Best bit of news I’ve seen in years that this monstrously inept QUANGO, namely the FSA, is to be de-clawed and thrown on the scrapheap.

    The FSA were instrumental together with the banks and treasury in causing the worst financial crisis this country has seen since the South Sea Island bubble.

    All they have done since is to try to appear tough by picking on the little guys. Not saying these little guys aren’t in the wrong – but they were just a symptom and hardly the real problem!

    FSA (hopefully) your time has come – here’s hoping you get treated fairly because you deserve all you get!

  6. Good riddance to bad rubbish ! However, this is not a matter for the FSA to be handing out fines. It is a matter for the police and courts to put these people behind bars.

    The fines will only pay for more bonuses at the FSA.

  7. Seriously, well done FSA, shame that the funds aren’t spent more wisely though.

    You’ve got to have a bit o’ bubbly at the Christmas do!!

  8. Criminal activity should be reported as criminal activity not as a regulatory function!

    Why do we beat ourselves up about these criminals >how many solicators and accountants are struck of each year?

    Bank staff are foreced to resign so why are the FSA reporting only one small sector.thats right its called lip service

  9. One of my contacts said: “Regulation after the event, these people were always bent”, why did it take so long?”

    I say: Point, fine, ban.

  10. A disgrace to the industry, these people should never of been allowed to become mortgage brokers, they bring shame on the rest of honest brokers who stand for integrity and honesty for their clients.
    Good riddence to these bad eggs.!

Leave a comment