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Lenders scrap plans for loan fraud unit

Lenders have scrapped plans to launch a specialist mortgage fraud unit within the City of London Police.

Last year, the Council of Mortgage Lenders held talks with its members, the National Fraud Authority and the City of London Police about funding a unit with the aim of targeting mortgage fraudsters.

But lenders have decided their resources would be better targeted at their own systems.

A spokesman for the CML says lenders would prefer to prevent fraud than pursue prosecutions.

He says: “It was decided it is better to use resources to stop lenders being victims rather than channel them to the police to prosecute criminals.

“Obviously, lenders would favour prosecutions but that focuses on fraud that has taken place rather than prevention. It is unlikely we will be taking the proposals any further.”

PMS executive chairman John Malone says: “CML members have different priorities so trying to build a consensus was never going to be straightforward.”

Bill Warren Compliance managing director Bill Warren believes the decision makes sense for lenders. He says: “There is more regulatory emphasis on lenders protecting themselves than ever before. They have more control over protecting themselves rather than just dishing money out to the police.”

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