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Senior police officer in court over mortgage ‘gaming’ charges

A senior member of the Greater Manchester Police force has appeared in court today over charges of mortgage fraud, Manchester Evening News reports.

Chief Inspector John Buttress, 48, was arrested at the GMP headquarters in March last year having allegedly taken out a residential mortgage for a property in Wrexham, North Wales and subsequently rented it out as a holiday-home.

The farmhouse property was purchased in 2007, at which point Buttress wrote to his seniors in the police force to inform them of a “business interest”, in line with regulations stipulating officers must disclose any second income stream.

In February 2011, Buttress applied for a £185,000 remortgage but failed to mention at any stage that he planned to let out the property to holidaymakers.

At the time of his arrest, Buttress stated he was unaware of the requirement to inform his lender that he planned to rent out the property. However, Liverpool Crown Court later heard that Buttress had done just that in 2000, when he told both GMP and his mortgage lender that a property he owned was being let out.

Buttress denies any wrongdoing or that he dishonestly and intentionally withheld information from his mortgage lender relating to the purpose of the property being mortgaged.

The case is ongoing.

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Comments

There are 13 comments at the moment, we would love to hear your opinion too.

  1. Is it right then to imagine that the individual brokers (and solicitors and others acting) who helped so many people to secure loans using false information of which of course they were well aware, just to secure a mortgage for their client and fees for themselves, will be treated proportionately to a banker who avoids train tickets because of a failure in the ticketing system (not that I am condoning such behaviour)? Who knew that a policeman working in Manchester was unlikely to be living in a property in Wrexham, North Wales? Still, it was his signature on the documentation which stated the purpose of the loan and that the information disclosed was true. Of course, if this was his primary residence at the time of the purchase and he rented for work, say, then that is not a fraud, regardless of what he does ‘later’ as long as he advises the lender which may then charge a higher rate.

    My experience is that abuses are still going-on by ‘advisers’ albeit heavily stamped-upon recently.

    Still, at the moment we assume there aren’t losses from the frauds if the properties have been sold (if necessary) for enough to cover the debts but what will happen when the market falls, interest costs increase and repossessions arise…

  2. There was a similar case close to me when a young man lied about his earnings to get a mortgage to buy a letting property. He was subsequently jailed. However at no time had he not met his mortgage repayments. So one surely must question in whose interest such a prosecution was brought. The only victim was the borrower who had done nothing worse than overstate his income and then ended up with a criminal record. His only crime was to try and better himself. I just don’t see the problem with any loan for any justifiable purpose as long as you keep up the repayments.

  3. Gordon Sinclair 6th January 2015 at 8:24 pm

    @ Knightly

    Its still fraud. You sign a legal declaration to state that you have told the truth.

    Lenders base their decisions to lend on this.

    Whether or not he could afford repayments is largely irrelevant.

  4. Sorry Knightly, I disagree. It is about honesty.

  5. Indeed, it is about honesty.

    My subsidiary point was – when will the solicitor, financial adviser, the financial advisory firm, Estate Agent, etc, receive the regulator’s attention for participating in these frauds? Some of them, at least, would have known.

    Then the net would need to be cast far and wide as all types of jiggery pokery have been perpetrated by some advisers simply to secure the debt the buyer wanted, to buy a property (and this is before the ‘self-certification’ lies by so many and still sitting there on the files).

    Many people out there seem to think it’s fine. This week I had a speculative call from someone, quite an ostensibly pleasant and normal person just trying to repair his family life after a divorce with £50000 who wants to buy the £300000 house he is renting. He had spoken to a local mortgage broker and formulated his thinking so wanted to do it in his sister’s name as a BTL and would say the rent was £900pm not the £700pm he is paying (oblivious of an independent valuer’s opinion), his sister has her own home with mortgage but rents-it-out and lives with her mother, where her brother also lives and they have a mortgage on that and…. but of course the mortgage would cost less than the rent so it’s ok isn’t it…

    Oh yes, his other income, thinking that route? Well, his accounts read badly he tells me as he does lots of cash jobs and by-the-way, could we do his accounts for the 31/1/15 deadline please? The answer was no, unfortunately… and the information has been processed…. and the guidance to adhere to the rules given but I suspect to little avail….

  6. Grey Haired Underwriter 7th January 2015 at 10:23 am

    @ knightly – I find your comments quite scary. Fraud is fraud and there should be no attempt to justify it. I hope you are not a broker because it suggests that you would condone one of your clients actions for making false declarations to a lender.

  7. Interesting to hear these self righteous comments. I agree that in the narrowest sense it is fraud but a crime that has been perpetrated by thousands. Frankly if you want to be completely honest in this life you are doomed to failure. But of course those at the top of the professions and industry in this country who got there by manipulating figures and circumstances will never admit to any questionable undertakings. You only have to look at the rich lists to identify individuals with some very shady dealings. Much worse than overstating their income to obtain a mortgage! What lenders and regulators have to appreciate is that affordability is different from one person to another even when on the same income. What of course we don’t know is just how much over borrowing here in the UK contributed to the “depression” or whether it was caused by the trade in US mortgages? The problem is potential home owners in the UK are now suffering. I don’t blame anyone for exaggerating their income if it will get them what they want. The proviso is the loan is their responsibility and if problems arise it is up to the borrower to solve them. Just so you know I am not involved in that side of business!

  8. I don’t advise on mortgages and haven’t for some years, purely and simply because the whole system of how we lend money for house purchase (res, BTL or other) is completely flawed.

    I do get where Knightly, is coming from you will always get non-disclosure and/or inflation of the truth in a area such as mortgages where the subject matter is so over priced and hard to obtain, we are after all, a nation (in the main) of home owners so many will try to get their own house by any means or bending the rules

    Re-: my first statement its all self defeating which keeps house prices disproportional to affordability and worth.

  9. Gordon Sinclair 7th January 2015 at 2:23 pm

    @ Knightly

    I sincerely hope that you are not involved in the advice industry.

    Admitting that you would be willing to turn a blind eye to a “little bit” of fraud is shocking.

  10. @Philip Milton – Can you just drop me your email address please as I need to send you something? phil.castle@fescape.co.uk

  11. @ Gordon Sinclair

    It’s a pity that for your piety you cannot read. Or rather read into something that which is not there. I have not said I would turn a “blind eye” to any illegal activities. However I do understand why these come about. I also believe it ill behoves our law makers to introduce laws that criminalise people for, as far as I can, victimless crimes. We need to bear in mind that laws are made by men and women and we know some of the activities of some of our lawmakers are themselves illegal or verging thereon. Of course nowadays there is also the arguement that we have to protect everybody from everything and create a whole raft of gobbledegook that does nothing for nobody and just slows down normal business processes. In all of my activities business and personal I always maintain the highest standards of propriety. That does not mean that I should stay silent when I witness the under nonsense and damage inflicted upon my fellow man by the fools who run this country.

  12. Contractually anon 7th January 2015 at 5:17 pm

    I understand some of the opinions regarding mortgage statements but the answer has to lie with tackling the affordability parameters as an industry and not in turning a blind eye to fraud.

    Sorry Knightly for singling you out, but a comment such as ‘Frankly if you want to be completely honest in this life you are doomed to failure’ has absolutely no place in this industry.

  13. Gordon Sinclair 7th January 2015 at 8:57 pm

    @ Knightly

    I apologise if I offended you in any way…not intentional.

    In my opinion there are rules surrounding these things that need to be adhered to. It does not matter to me who wrote them and I agree that there are some less than pleasant lawmakers out there.

    However; in matters such as this the rules are there for a reason and are important. Bending the rules to suit isnt acceptable.

    I am sure that there are a plethora of cases out there where people were a bit economical with the truth in the certainty that it didnt matter who are now up that well known creek without a paddle. It will get worse when interest rates rise again next year.

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