FSA bans directors of mortgage firm for failings on financial crime prevention

The Financial Services Authority (FSA) has banned Dorset mortgage brokers Peter and James Dean for failing to prevent their firm from being used to perpetrate financial crime and for other serious regulatory failures. Peter Dean has also been fined GBP17,500.

Georgina Philippou, head of retail enforcement at the FSA, said:

"The actions of Peter and James Dean posed a serious risk to lenders and consumers. As part of our crackdown on financial crime in the mortgage market we have banned a number of mortgage brokers and others in the last year and we will continue to make examples of people, including by bans and fines, who either commit mortgage fraud or fail to prevent their firm from being used to further financial crime."

Peter and James Dean were Directors of UK Finance House Limited (UKFH) with Peter Dean based in the Poole office and James Dean in the Bournemouth office. The FSA found that Peter Dean failed to:

• take reasonable steps to prevent false information being supplied to mortgage lenders by UKFH;
• take reasonable steps to prevent UKFH from being used to further financial crime;
• realise that mortgage introducers were acting on behalf of UKFH and arranging regulated mortgage contracts without its authority or permission;
• realise that James Dean was signing off regulated mortgage applications as his own work, when they were in fact prepared by a third party.

The FSA also considers that Peter Dean engaged in unauthorised mortgage business by providing a regulated mortgage contract to a client through an unauthorised company of which he was a Director. Peter Dean qualified for a 30% reduction in penalty by settling at an early stage of the FSA's investigation. Were it not for this discount, the FSA would have imposed a financial penalty of GBP25,000.

The FSA found that James Dean:

• submitted a personal mortgage application containing false information about his employment and earnings;
• signed off and submitted to lenders mortgage applications which contained false applicant incomes and false documentation in support of applicants' identity verifications.

The FSA found that both Peter and James Dean failed to take adequate remedial action in 2006 when they discovered that false information had been supplied to lenders in support of mortgage applications and therefore that UKFH might have been used to perpetrate financial crime.

The FSA has also cancelled the permission of UKFH.

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