Advisers have duty of care as fraudsters step up scam activity

Bob Hunt

Bob Hunt

17 August 2020

'Time and tide wait for no man...' Well over six hundred years after Chaucer wrote those words, we might justifiably add 'fraud' to that particular list.

This is especially so during the pandemic when fraudsters appear to have not only stepped up their activity but are utilising Covid-19 as a way to extricate people from their money.

With many people experiencing real financial worries, even the most vigilant could be persuaded to part with personal or banking details or hard-earned cash - duped into thinking government was requesting them, or they were eligible for greater levels of support.

Research from UK Finance highlighted ten Covid-19-related scams that were currently being perpetrated and which people needed to be wary of.

These went from fake government emails offering grants in exchange for personal or financial details, to potential Council Tax reductions, and emails from 'TV Licensing' offering six months free.

All communications I'm sure look, on the surface, convincing and - when people might be feeling desperate or overwhelmed - there could be a tendency to provide information without even thinking.

Unfortunately, that's exactly what the fraudsters want.


Advisers are a line of defence

Of course, in the mortgage market, we are no strangers to the attempted perpetration of fraud, especially when dealing with such large transactional sums and, where potentially, heads might be turned by the thought of pocketing them.

At its most base level we have income fraud, shown via fake payslips/banking details.

But there's also the potential for self-employed individuals masquerading as employed, or those who appear to be employed by a family business.

And of course there are also identity theft, and attempts to hijack properties and remortgage them, not forgetting the targeting of clients by fraudsters pretending to be conveyancers or the lender itself.

Advisers are certainly one line of defence in trying to stop fraud and, for the most part, we as an industry are very successful at doing this.

Let's be frank, some of these attempts can be crude to say the least and there are normally multiple giveaways which, at the very least, should raise suspicions that can be identified and investigated.

Others will be more sophisticated, and clearly with the increased use of technology within the property process, there are opportunities to use technology to defraud more than ever before.

However, the very same technology can also be used to combat the fraudsters particularly in areas like identity and documentation checking or having secure systems that cannot be infiltrated.


Duty of care to borrowers

Advisers also have a duty of care to their clients and part of that will be around the potential for fraudsters to target them.

In that regard, clients should be warned about publicising their property transactions via social media and the like, because undoubtedly fraudsters will use that information to try and access emails and infiltrate the process.

To help advisers with anti-fraud activity we recently updated our eBook on fraud prevention and what firms should be aware of.

At a time when the last thing anyone would want is to be a victim of mortgage fraud, putting in place these robust measures and making your clients aware of the potential threat will go a long way to countering the fraudsters.

Unfortunately, they are not going away anytime soon.

Reading this blog counts towards your CPD!

Click here to add this session to your Paradigm CPD log.

20 December 2021

The public gets what the Public wants’ - or do they?

10 December 2021

Consultation Paper CP 21/36 “A new Consumer Duty”

7 December 2021

FCA’s Consumer Duty seems like a costly exercise for advisers

2 December 2021

Cyber crime update and reporting requirements

9 November 2021

Who will buy...?

1 November 2021

FCA: Remote working expectations for firms

18 October 2021

Remortgaging: Timing may not even matter this time

8 October 2021

Make stamp duty work for everyone

4 October 2021

Time to talk

1 October 2021

The FCA’s plans to tackle investment harm

27 September 2021

Lack of housing stock means brokers need to work client banks harder

3 September 2021

Let technology do the work in the fast-paced mortgage environment

2 September 2021

Time of new beginnings

18 August 2021

The proof of the pudding

12 August 2021

FCA pension transfer advice: don’t be confused by the label

12 August 2021

Time for a change?

26 July 2021

The engagement conundrum

26 July 2021

"I can’t do it all"

7 July 2021

Paused for breath

6 July 2021

SMCR part two - conduct questions

28 June 2021

Introducing a new us!

17 June 2021

Patches - what are they and why are they so important

17 June 2021

Multi-factor authentication - the simple solution

8 June 2021

SMCR part one - time to take stock

27 May 2021

A reminder of the 'good old bad old' days of protection tech

18 May 2021

Let's not consider any 'reduction' in these as some sort of victory

5 May 2021

Simple methods-calculating client profitability

30 April 2021

If the pandemic has been the mother of invention, it's time to carry on

22 April 2021

Opportunities abound in the market

19 April 2021

Early Movers are Shaping the 95% LTV Market

13 April 2021

Here's a conundrum

8 April 2021

Advice processes for vulnerable clients

29 March 2021

Vulnerable signs for advice firms to watch out for

5 March 2021

Lenders have not got to grips with how the pandemic impacted borrowers

2 March 2021

How Covid has changed our financial lives

2 March 2021

Supply needs to match demand

19 February 2021

Don't overlook product transfers

16 February 2021

Creating a plan for good CPD

5 February 2021

Stamp duty debate a black hole

2 February 2021

Industry wide levy is a head scratcher



APCC Member
Paradigm Consulting is a Member of the Association of Professional Compliance Consultants

Paradigm Consulting is a trading name of Paradigm Partners Ltd
Office address: Paradigm Partners Ltd, Paradigm House, Brooke Court, Wilmslow, Cheshire, SK9 3ND
Paradigm Partners Ltd is registered in England and Wales. No.09902499. Registered Office: As above

Paradigm Mortgage Services LLP
Office address: Wellington House, Starley Way, Birmingham International Park, Solihull, B37 7HB
Registered in England and Wales. Company No: OC323403. Registered Office: Paradigm House, Brooke Court, Lower Meadow Road, Wilmslow, SK9 3ND
Paradigm Mortgage Services LLP is a Limited Liability Partnership.

Paradigm Protect is a trading name of Paradigm Mortgage Services LLP
Office address: Wellington House, Starley Way, Birmingham International Park, Solihull, B37 7HB
Paradigm Mortgage Services LLP is registered in England and Wales. Company No: OC323403. Registered Office: Paradigm House, Brooke Court, Lower Meadow Road, Wilmslow, SK9 3ND
Paradigm Mortgage Services LLP is a Limited Liability Partnership.