Notorious Difficulties

Democratic socialist and one of the most influential English writers of the 20^th century, Eric Arthur Blair (otherwise known as George Orwell), once said, “If you want a vision of the future, imagine a boot stamping on a human face -forever” and, as a result of this week’s disappointing developments, it’s hard not to imagine the human face being stamped on is destined to be mine.

In March 2006, having discussed our financial circumstances with a financial advisor/mortgage broker, my husband was told we could reduce our outgoings by more than half if we agreed to switch our existing mortgage of £725,000 to the Bank of Scotland and take a further advance of £65,000, secured against our home, to repay our credit cards. Desperate to alleviate his cash flow problems at a time when the terminal illness of two of his closest relatives was making it impossible to divide his time effectively between the needs of his family and the demands of his business, he agreed.

• The mortgage application (which we never saw) was submitted on line by a broker we never met
• There were no acquisition costs to pay, neither were there solicitors or surveyors to instruct as the cost of the valuation and the conveyance, along with instructions, were taken care of by the lender.
• And, on 30 March 2006, after being told by the broker we had received a mortgage offer for £790,000 from the Bank of Scotland, we signed the declaration page and the direct debit mandate of an otherwise blank application form.

As a result, the broker earned £4,500 and we unwittingly agreed to move from a very tight corner which could have been rectified by the sale of our house, to an impossible situation amounting to tens of thousands of pounds in arrears, a £217,000 shortfall following the forced sale of our home in 2009 and six long years of battling with an unsympathetic bank while trying to establish precisely what had gone on. Had HBOS not sent me an entirely unsolicited copy of our original application form (minus the declaration pages) by way of an explanation to some wildly inaccurate claims they were making about the original purchase price and original purchase date of our house, I might never have discovered the fraudulent nature of the information it contained.

Having reported the fraud to HBOS and been advised never to contact them again, I immediately reported the matter to the FCA who were insistent it was beyond the remit of both themselves and the FOS.  Because of this I was told I should go straight to the police and, encouraged by the diligence of Action Fraud's staff to record the details of my case and the news they could present the crime as an Abuse of a Position of Trust, I looked forward to being contacted by the Serious Fraud Office of the Devon and Cornwall Police.

However, all appears not to have been as it seemed as, without even looking at any of my documentary evidence, I am now told the police will not be investigating my claim of mortgage fraud as cases of this nature are,

• Notoriously difficult to understand
• Notoriously difficult to take forward if the real victim, namely the bank, does not come forward
• Notoriously difficult to prove

I am further advised, 

• I am not the victim of the crime and have therefore experienced no loss
• I may well be considered complicit in the fraud as I gained from the brokers actions
• At best, a fraudulent mortgage application is a civil matter or a case for the FOS

They suggest,

• I bring the bank's irresponsible lending to the attention of the financial ombudsman and the financial regulators.

Politician, historian, author, political consultant and 58^th speaker of the U.S. House of Representatives, Newton Leroy “Newt” Gingrich once said, “Perseverance is the hard work you do after you are tired of doing all the hard work you already did” yet despite the endless hard work of the past six years, this widely documented crime which was designed by the banks, implemented by unscrupulous brokers and facilitated by in house lawyers and solicitors, continues to go unpunished.

In the US the Bank of America recently agreed to pay $16.6 million in settlement for their mis-selling of mortgage backed securities in the run up to the financial crisis, but when it comes to justice for those of us who were coerced into the obtaining the unsuitable/mis-sold mortgages in the first place, there is none.

Truth and Understanding

Fourteenth century Italian physicist, mathematician, engineer, astronomer and philosopher Galileo Galilei once said, "All truths are easy to understand once they are discovered: the point is to discover them” and although discovering the truth about my Bank of Scotland mortgage has consumed my life for the best part of six years, understanding what the truth actually adds up to has only come to light during the past week.

Since the Bank of Scotland secured a court order to repossess my home in November 2008, disposed of it at a knockdown price in April 2009 leaving me with a £217,000 shortfall and then flatly refused to consider our circumstances or discuss their breaches in best practice, I have been kept  very busy.

I have;

• Written countless letters to the FSA, the SRA, the FOS, the ICO, the Bank of Scotland, their debt collectors and the Bank of Scotland's CEO's Eric Daniels and Antonio Horta Osorio.
• Scoured FB, twitter and the newspapers for both information and expertise
• Used my 180 Life after Debt blog posts to find other individuals who have suffered at the hands of HBOS and in doing so secured more expertise

And,

• Compiled five lever arch files of evidence and information to support my case of complaint

This week, armed with all of the above, I have finally presented my findings to the police and, as a result of three phone calls to and from Action Fraud and the hour long telephone interview I gave, I have now been told the following;

• The crime I have reported is to be taken forward as an “Abuse of a position of trust”
• My mortgage application, which was falsified by a third party, ticks every box for mortgage fraud

And,

• As a result of my report, I must contact the Bank of Scotland once again.

To this end I wrote the following;

Dear Mr *******,

Mortgage Account No. ********-*/***/***

Crime Reference No.XXXX**********

Although you expressly stated in your letter of 24 July, “Any attempt to contact the Bank Of Scotland Plc (Halifax Division) regarding the above account will result in you being referred straight back to drysdenfairfax solicitors” , I have been asked by the police to advise the Bank of Scotland of the crime reference number I have been given for the mortgage fraud  I have reported to the National Fraud Intelligence Bureau (see above) and make the bank aware that it has also been the victim of the same mortgage fraud so it can file a report with Action Fraud as soon as possible.

Yours sincerely

LAD

In addition, I am reliably informed that having a crime number will encourage an altogether different reaction to the one the Bank of Scotland has seen fit to mete out to me in the past. Furthermore, my much valued FB friends and Twitter followers expertise, combined with a few legal opinions a little closer to home, suggest the unlawful repossession of an individual’s home and a comprehensive paper trail to boot is pretty solid ground from which to pursue compensation.

Widely regarded as one of the greatest wartime leaders of the twentieth century, UK Prime Minister Winston Churchill, once said, “The truth is incontrovertible. Malice may attack it, ignorance may deride it, but in the end, there it is,” and, after six arduous years of searching for the truth, the Bank of Scotland boot  finally appears to be on the other foot and what's more,

The foot appears to be mine!

Maltesers and Madmen

The Maltese physician, inventor, author of Six Thinking Hats and the man who coined the term “lateral thinking”, Edward de Bono, once said, “Unhappiness is best defined as the difference between our talents and our expectations” and this has certainly proved the case for me in my fruitless attempts to get the Bank of Scotland to write off a mortgage shortfall their irresponsible lending culture, their gross incompetence and their rapacious greed created.

Throughout the past six unhappy years I have spent countless hours explaining;

•  Neither my husband or I have anything more than a subsistence income with which to support our three children.
• Neither my husband or I have any capital with which to repay an alleged mortgage shortfall of £217,00,

And, as a result of my recent findings, further explained,

• Like me, HBOS has been a victim of broker mortgage fraud and, as a result of the falsifications which were submitted by the broker in an online application, their mortgage contract with my husband and I is not only void but cannot be enforced.

However, rather than respond to my repeated requests for documentary evidence to help support my case against the broker with the Cornish police, I have just returned from my much needed two week holiday with family to eight letters from the Bank of Scotland and their solicitors not only asking for payment in full but telling me;

•       “We understand that this account is not in dispute”
•    “There is no valid reason for it to remain unpaid”

And,

•        "We do not wish our request for payment “to have a detrimental impact on your personal finances”

Edward de Bono also said, “Most of the mistakes in thinking are inadequacies of perception rather than mistakes of logic” but after six years of flogging the HBOS dead horse I can only wonder...

WHAT ARE THESE PEOPLE ON?

From Ashes to Ashes

Sixteenth century English poet, critic and writer Samuel Johnson once said, “Fraud and falsehood... dread examination. Truth invites it” and yet more than five years on since the near demise of HBOS, the long promised FSA/FCA investigation remains as elusive as the truth and the prosecution of those responsible.

Instead, some would have us believe the future is bright.

• Chief executive of Lloyds bank, Antonio Horta Osorio, says the ,“Hard work of the last two years has paid off”
• Chief executive of the FCA, Andrew Wheatley says, “New mortgage rules will hard wire common sense into mortgage lending”
• And Prime Minister David Cameron says the government is succeeding in “turning Britain around...and from the ashes of a great recession we are building a great revival”

However in stark contrast,

• Bank of England Governor Mark Carney has warned that Britain’s booming housing market represents the “biggest risk” to economic recovery.
• Lloyds PPI compensation bill has topped 8 billion with a further 750m set aside for future claims
• Financial Ombudsman Service figures reveal mortgage complaints are on the increase because more and more householders are unable to meet their commitments
• Analysts tell us PPI provision should no longer be classed as an “exceptional item” by UK banks as compensation claims for miss sold products are here to stay
• And,
• The Prime Minister’s brother, Alexander Cameron QC, along with Judge Anthony Leonard warned that the system of fair trials for some very high profile banking frauds are in jeopardy as a result of legal aid cut backs. They believe, “The public is entitled to expect that alleged victims have their complaints heard and defendants are given the chance to clear their names, not to mention the legitimate expectation that a government, which has talked tough on ensuring the appalling behavior of the financial sector is not repeated, delivers on its promises”.

For those who have paid the price of HBOS’ fraud and falsehood, the truth still falls a long way short of a revival and although Antonio Horta Osorio’s two years of hard work may well have “paid off” for him personally, for the vast majority of banking crisis victims, incomes (in real terms) have dropped, homes have been lost, austerity measures impact on every facet of their lives and legal assistance is even harder to access. Furthermore, while “new” mortgage rules may well reduce the number of miss sold mortgages in the future, they, along with the unsuprisingly similar “old rules”, remain nothing more than regulatory recommendations and, if the past truly is a reasonable indicator for the future, it would be fair to assume it is still just as unlikely there will not be much by way of consequence for those who continue to flout them. 

In truth the “ashes of the great recession” are very much part of  the landscape for the vast majority of us and not only do they fall a long way short of fuelling a revival, but instead they provide a harsh reminder of how little has changed for those who fiddled to secure immense returns while the UK economy burned. Furthermore, if the government and the regulators remain committed to endorsing criminal banking behavior with apathy, it will actively encourage the Antonio Horta Osario's of this world, their "hard working" executive offices and the toothless Financial Ombudsman Service to ignore the victims of the banking crisis too. Little wonder HBOS are unprepared to believe my six year old claim that my mortgage was arranged fraudulently or that my six week old request to supply me with further evidence to aid my case against their broker, even warrants a reply.

Influential English novelist, journalist and critic of social injustice Eric Arthur Blair, whose pen name was George Orwell, once said, “In a time of universal deceit - telling the truth is a revolutionary act” and I for one believe when it comes to HBOS, a much needed revolutionary act is long overdue.

Estimates and Equanimity

Stoic philosopher of service and duty, champion of equanimity in the face of conflict and the last of the five good Roman Emperors, Marcus Aurelius once said, “If you are distressed by anything external, the pain is not due to the thing itself, but to your estimate of it: and this you have the power to revoke at any moment” and, in the face of the  Financial Ombudsman Services painfully disappointing decision to reject my Bank of Scotland mortgage fraud compliant, I have spent the past few weeks revoking its power to distress by investigating and collating my evidence in readiness to give to the police.

During the process of making inquiries aimed at presenting the clearest of pictures, I have discovered the following,

• The Financial Ombudsman Service is not empowered to comment or rule on mortgage fraud and, according to the Financial Conduct Authority, should have made this clear to me from the outset.
• My local Serious Fraud Office are currently dealing with numerous broker driven mortgage frauds which are almost identical in nature to that of my own case. 
• Inland Revenue records show our taxable income for the preceding three years to our mortgage application was a mere 17% of that stated by the broker on our mortgage application.
• The mortgage application submitted to HBOS in March 2006 was not (as I originally assumed) self-certified but instead a full status application offering our company’s accounts as evidence of income and,
• Mortgage fraud can only be reported to the Serious Fraud Office in the district where the crime was committed.

Convinced this type of mortgage fraud was expertly designed by HBOS and merely implemented by the broker intermediary who introduced it, I made another request to HBOS’ executive team, this time asking them why they chose to remove the broker intermediary from their panel during the underwriting of my mortgage.

This was their response,

“With regards to your concerns about the removal of KMS from our intermediary panel, I have been in contact with our Credit Team and they have confirmed that both KMS and ******* ****** are still on our panel for intermediary business through the Halifax Brand under panel number***********...[and] the broker panel number [used previously] was not cancelled until October 2010 and was deleted as Arrangement Ended. This usually indicates a change of FSA status (such as principal) but is more likely to be due to the fact that the Bank of Scotland brand ceased taking introducer business in 2010. Therefore, our systems would update to show that the intermediary related to the panel number applicable to your application would no longer be on our panel as at today’s date.”

However, this lengthy and seemingly plausible explanation once again takes no account of the Bank of Scotland’s own underwriting screen notes for 2006 which clearly state,“The intermediary keyed for this application has been taken off the panel. Please refer to explain it for the appropriate course of action to take” which does not sound the least bit like a 2010 system update to me.Needless to say, I have now shared this information with Antonio Horta Osario’s executive team and am hoping they might  finally see fit to furnish me with a more meaningful reply.

British Indian novelist, essayist and author of Satanic Verses, Salman Rushdie once asked, “How do you defeat terrorism?” His answer was, “Don’t be terrorized” and after six years of living with the terrifying consequences of a financial holocaust in which the Banksters of Scotland have played a significant part, I now live in hope that it will be information which finally sets me free.

As ever, I wait without patience for some results!

Recipe for Disaster

Take three perfectly good financial products,

• One non status mortgage requiring no proof of income, a cautious valuation and client equity stake of 35%
• One 100% mortgage requiring no client equity stake, a cautious valuation but belt and braces proof of taxable income and affordability
• One 80% mortgage, a cautious valuation, belt and braces proof of taxable income and affordabilty offering discounted interest payments for the first two years

Add a large helping of political gain with nauseating proportions of deregulated bankster spin and mix well.

Throwing caution to the wind, allow evidence of income, equity and conservative valuations to float to the top, carefully remove and discard.

Using what is left, re-package as an innovative low risk mortgage product which will take the market by storm

Present finished article to the board in terms of anticipated personal returns and obtain consent to market.

Use highly incentivised bank staff to roll out new product to as many brokers and introducers as possible, turn a blind eye to their methods and pay all concerned on results

Insist all new applications are submitted online by the broker with declaration pages to follow after offer

Provide regulated mortgages of up to a 125% LTV having told brokers that applicants homes will not be valued conservatively and applicants incomes will not be verified.

Have your cake and eat it while watching with detached indifference for the cookies to crumble,

Leave the victims of widespread mortgage fraud to cook in their own juice,

And then, just like HBOS have done with my own case,

Wash hands thoroughly.

Washed Up

Irish playwright, journalist and co-founder of the London school of Economics, George Bernard Shaw once said, “Cruelty must be whitewashed by moral excuse and pretence of reluctance” and unsurprisingly my experience in the ineffectual hands of the Financial Ombudsman Service has amounted to nothing less.

Established in 2001 by parliament, the Financial Ombudsman Service is supposed to be an impartial and independent body which settles disputes between consumers and UK based businesses providing financial services. We are encouraged to believe the law requires the ombudsman to take into account relevant law and regulations, regulator's rules, guidance and standards, codes of practice, and (where appropriate) what he/she considers to have been good industry practice at the relevant time, in order to make decisions which are fair and reasonable. From a current case load of over 500,000 each year (a level which has swelled its ranks by four fold since the onset of the banking crisis in 2008), it is estimated the FOS rule in favour of the complainant in approximately 49% of cases.

I am not one of the lucky ones.

As a result of my appeal to have my case against HBOS reviewed by an ombudsman, my FOS Final Response has not only dismissed the majority of my case as immaterial and irrelevant but my ombudsman states she has “difficulty in accepting” my claim that either HBOS or their mortgage broker acted fraudulently in order to secure my mortgage business.

I am told she, like my adjudicator, is;

“Not required to respond at ... length or to respond to each and every point raised” but instead has “considered the case in the light of the lending climate at the time [having] noted that the bank has said it will not be pursuing Mr and Mrs [Life after Debt] for the shortfall debt" (a statement which is completely untrue).

Despite the basis of my complaint being that my mortgage application was submitted on line by a broker I never met using an application form I never saw and information I did not supply, I am further advised;

• “ The bank could not have been expected to know the information about the purchase price and date was untrue”
• “The [brokers signature] on the application form [and the photo copied passports] confirms there was a face to face meeting”
•  “The factual inaccuracies in the application...were signed as being true”

What is more she has also informed me, with complete disregard for my protestations that her findings are based on false assumptions and not the evidence, the FOS will be publishing her travesty of a ruling on my case on their website.

Former Chief Ombudsman Walter Merricks once said, “The FOS is an unusual creature. One I would suggest parliament would not have dared to create had the ground work not been laid by a series of voluntary initiatives. It is a one sided scheme offering an unlevel playing field broadly supported by those playing up hill...We do not have to pretend to find what the law is. We unashamedly make new law”.

After six whole years engaged in battle with HBOS which now includes a shambolic, whitewashed FOS investigation into my case of complaint, I have now been thrown straight back into the lawless clutches of one the most infamous banks and their debt collectors.

I find this not only to be immensely cruel, but also wholly immoral and completely unjust.