Context
Following an investigation, the FCA has commenced criminal proceedings against two individuals.
Key points to note
- The proceedings relate to an offence of conspiracy to commit fraud by false representation involving both defendants and two further offences by one of them of carrying on regulated activities without authorisation.
- One of the defendants traded as an unauthorised financial services firm based in Nottingham. The other is an accountant who ran an accountancy firm, also based in Nottingham.
- The fraud charges relate to a series of mortgage applications made between January 2015 and March 2018. The alleged conspiracy involved mortgage clients of the unauthorised financial services firm. If the financial services firm concluded that applicants had insufficient income to justify the mortgage required, it would charge the client a fee which the client would then pay in cash to the accountancy firm to create the false self-employment, and employment documentation to support mortgage applications for clients with insufficient income. The total value of the mortgages applied for was circa £3.8 million.
- Conspiracy to commit fraud by false representation is contrary to section 1 of the Fraud Act 2006.
- Carrying on regulated activities without authorisation is contrary to section 19 of the Financial Services and Markets Act 2000.
Next actions
This is provided for information, but demonstrates the Regulator’s appetite for criminal proceedings where it feels these are appropriate.