CFI: NACFB
ING shines light on fraud problems and solutions by Chris Ferguson, NACFB
You might remember hearing all about the Lord Davenport case in the media recently. In an age when so many people see “bank” as a four letter word, any financial fraud will grab the public’s attention. So accepting, or having a part in, any fraudulent transac- tion won’t simply harm you personally. It has potential to harm the entire industry. ING served up some fright- ening statistics at its recent Fraud Awareness courses (run in conjunction with the NACFB) across England. Ap- proximately £4bn was lost in the financial services sec- tor during 2010 – the most recent year
for which full
figures are available. ING’s own actions are spotting and
preventing between £2m and £3m every month. It’s an upward trend too, possibly because borrowers are more and more willing to turn to quick fixes, and there are bigger gaps in the market created by more reluctant established high street lenders. ING also presented a page of publicly available data showing how much money was lost by various high street names in 2010 due to fraud. The figures tended to run to millions of pounds, though ING’s own losses were by far the lowest, which suggested it made sense to listen to what they had to say.
Checking credentials At the NACFB we’re hear- ing from an increasing num-
NACFB increases its patrons
The past few weeks have been particularly busy for the NACFB with Adam Tyler, CEO of the Association, meeting with a host of funders that have expressed an interest in dealing with the membership. We are pleased to announce that three new funders have recently joined the NACFB: FBSE Finance Ltd, Contour Capital and Montello. Adam Tyler has also met with an additional nine lenders over the past few weeks which are at various stages of applying for NACFB patronage – details of these funders will be announced when they have joined the Association. The NACFB have also secured exclusive arrangements with some of these lenders and many of the schemes will be announced in the coming months. The NACFB is always looking for news funders for its members and the diversity that the patrons’ panel now offers is a great asset to the NACFB membership.
“Where online fraud is increasingly prevalent, the diligent broker can turn to online methods to spot and stop fraud”
ber of borrowers who pick up the telephone to check broker credentials,
anxious
to do good business with trusted brokers that a third party can vouch for. Borrow- ers are more aware than ever of the risks inherent in the industry. The NACFB posi- tion on upfront fees, for in- stance, is particularly clear. However, there are many less obvious opportunities for fraud which brokers need to be looking out for. ING has been keeping tabs on what it’s found, and the biggest growth industry is currently identity theft – not only the identity of an individual, but the whole make-up of a company.
Where online fraud is increasingly prevalent,
the
diligent broker can turn to online methods to spot and stop fraud. For example, the “who is” website will confirm if a company’s site is as long- established as it claims to be. Credit check sites will flag up if an individual is considered high risk, and give reasons
why. The internet is full of helpful places to go, and it is getting harder for fraudsters to hide behind false identities and false claims. And then there’s still the old fashioned approach. Pay a personal visit to a client seeking a small sum for a small start-up business, and if you find he has three Maseratis in his driveway, you might find yourself with some extra questions. There are still limits to what the inter- net can do for the diligent broker.
Instinct and experience ING’s training course made one thing abundantly clear; if you’re not doing the checks, online or on foot,
you’re
making a false economy in time-saving. We all have le- gal obligations to “know our customer”, but the law isn’t a didactic one – it won’t tell you a simple tick-box strat- egy to spot fraud. So use your experience. Use others’ experience. Use instinct, but don’t rely on it. Cases that “feel right” can prove to be clever fraud; cases that pass all standard checks can still be illegitimate. Thanks to ING for so generously sharing their own experiences at a num- ber of well-attended events throughout January and Feb- ruary. We’re planning an ad- ditional session later in 2012 so do check the NACFB web- site for event updates.
46 MORTGAGE INTRODUCER MARCH 2012
www.mortgageintroducer.com
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