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A practical and essential session in regards to key indicators of mortgage fraud along with the latest guidance in fraud prevention policies.
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A course covering the key indicators of mortgage fraud along with the latest guidance in fraud prevention policies and procedures from the SRA, CLC, FCA, lenders, and law enforcement agencies. The course will feature data demonstrating trends in common frauds over time, as well as the links between mortgage fraud and
a. other frauds,
b. forms of money laundering
We will also cover what to do if you suspect mortgage fraud.
The course could be run as a 'flipped classroom' with a filmed scenario (supported by reading materials) posed at the beginning of the course for delegates to work on and consider, followed by presentation content both covering the content above and explaining the possible answer.
We are presenting an up to date, highly interactive course on mortgage fraud following a major shock to the economy. Financial fraud investigators generally say that fraud losses increase following a major economic downturn. Law firms should have a heightened awareness of the risks of fraudulent transactions during and immediately after coronavirus, as well as the potential for fraudulent claims during the period.
What are the requirements?
Watch the recorded webinar and review the documents
This course provides 1 CPD points
On completion of this course you will cover:
The key indicators of mortgage fraud
The latest guidance in fraud prevention policies and procedures from the SRA, CLC, FCA, lenders, and law enforcement agencies
Data demonstrating trends in common frauds over time
Forms of money laundering
What to do if you suspect mortgage fraud
What is the target audience?
Practitioners dealing with fraud in particular Mortgage Fraud
Jackson is a consultant specialising in law firm compliance and
regulation. A former Inspector for the Council for Licensed
Conveyancers, Katie led and managed inspections of some of the
largest conveyancing practices in the country. Prior to working for
the CLC, Katie spent a number of years working in various inspection
and policy roles for the Solicitors Regulation Authority, and Legal
A practical and essential session in regards to key indicators of mortgage fraud along with the latest guidance in fraud prevention policies.
Hello and welcome to today's session on mortgage board. My name is Katie Jackson. I'm a compliance consultant and I'm here today to talk to you in this book now about some of the indicators of mortgage forward and what you can implement within your firm. So what we're going to cover in today's webinar, we're going to have a look at some different types of mortgage forward and when we're talking about that, some examples of mortgage forward, we're going to have a look at some different examples, including issues of misstatement, which is where people have provided, for example, the wrong information to the mortgage company. We're going to have a look at an example of a mortgage forward ring where there's more than one person involved and there's a ring involved in trying to facilitate stealing money taking money from as a result of a mortgage being lent out, where that money is taken, whether it goes and how that um, that ring operates. We're also going to have a look at the concept of flipping, which is um, you know, inflating the property's value. Sometimes this can be seen as being a legitimate way to increase the property's value by flipping it by investing in the property, for example, by rebuilding sections of it, for example, those kinds of things in other cases is not legitimate what's going on in that situation. So we're going to examine, you know, the difference between that and the link between that and the ring. How it's a shortened version. We're going to have a look at some other scams. Now, today's session is a flipped classroom session and the point of um flipped classroom is to give you activities for you to do within you know, your own time after today's session which also counter CPD with that reflection um, tasks for you to implement within your firm to ensure you're tackling issues of mortgage forward and then it gives you the opportunity when you've undertaken that task to then say, how did that go? Did that result in greater awareness of mortgage board within the firm for example or did it for example, allow us to better combat mortgage board. I have the policies and procedures to do that. So giving you the opportunity is implementation is learning by doing to then say, okay, this is going to take this away put in place in our firm and giving you the opportunity to reflect and see whether there's anything different you do, but by doing that you are learning okay. So we're acknowledging that as part of this flipped classroom tasks and it stops this session being just a flat piece of paper that you then put in a drawer somewhere. We don't get to see that implemented, Bring that out part of your learning and your CPD and try to bring that to life. Okay, so that's the point of this part of a flipped classroom session. The other things we're going to cover in today's session are charges at the land registry and we're just going to have a little bit of a discussion about how sometimes when we can see problems with registering in charge of the land registry, it can be an indicator of a broader underlying problem within transaction as a whole. And some of these issues afford really complex. So it can be really hard to unpick what's actually happening. And that's part of the point of some of these transactions. So they've been deliberately designed in that way to be very complex. And so you can't quite tell what's happening. But there can be an issue when we're talking about uh you know, talking about mortgage forward, we can sometimes see these things come out when people start to try to register charges at the land registry or whether, you know, the mortgage funds and purchase monies have actually gone. Um we're going to have a discussion of the proceeds of crime act as relevant to today's session, although today's session is not a money laundering session as a whole. Um so it is something that I'm just going to pick out some different points of the proceeds of contact as we go through the session. But it is something where I would say actually, you know, take the opportunity to go and have a look at the money laundering session in respect of this if you need to as well. Now as I've said, we've got this um flipped classroom and the handout that you get with today's session is about that flipped classroom. So it's about taking that away and implementing that within your firm and then having that reflection for your additional CPD within this session. Now I'd like you to do that. But there are also more ideas of other scams are listed on your hand out as well for you to try to have a think about implementing within within your firm policies and procedures to try to tackle some of these things. Now when we talk about flipped classroom, flipped classroom is it means it's the other way around. It's not me just telling you what to do. The idea is you get the opportunity to go away and do it for yourself and then you get the opportunity to reflect which is why it's flipped. Okay, so you're the one who's going to be in a position of implementing something of doing something of perhaps having that discussion with other people and then you know, you can then have that pause an opportunity to then say at the end. How did that feel? What did I learn from actually doing? So the classroom then becomes your office, becomes your workspace. And that's the idea of the flip classroom. I'm giving that over to you with the exercise for you to do. So that's at the end of the session is not intended to be A full hours presentation. I have just done one on everyday copan coffer where I did actually end up talking for the entire hour. So do you bear in mind that is not intended to be a full hours presentation and some of the learning from this is intended to go over to you for you to implement within your own session um and your own workplace. Okay. And part of that should be encompassed within your learning and development plan if you're taking that opportunity and and that reflection so you do some of that activity yourself. Um so we're gonna have a bit of chalk and talk first the traditional way of learning with me speaking but then you know you do get that opportunity to participate and joining as well. So there's a real distinction when we're talking about that fruit classroom and that's how we've set some of these latest sessions up. So let's have a look at the different types of mortgage forward that we're going to cover in today's session now this is not exhaustive, it's just something that I've put together to try and explain some of these points and I used to work for the solicitors regulation authority and also for the council of license convince as well and I still do a lot of work with obviously in legal services more generally but also in particular with conveyance is still and you can end up in the situation where you start to see some of these different transactions and despite my many years of experience I started working with what was the law society um Back in 2005 as a caseworker. And um you know, seeing some of these issues of mortgage forward that you would see on some of the cases that we had to deal with, where solicitors have been implicated. And sometimes, you know, completely not their fault. And you start to understand that sometimes there's a real complexity to this. Having tried to unpick some of these cases, it's almost impossible to do so because some of the people aren't genuine, some of the circumstances aren't genuine. Some of the people are pretending to be other people. In some cases, the movement of money has been sent in many, many different directions. And so you start to understand that actually what you're dealing with is just a mess and somebody's just trying to extract money from the overall situation where it can't be explained. Now in today's session, we're going to talk about some of those different issues and I'm going to try and explain a broad situation where we can see modus operandi in some situations that can lead to mortgage forward. And some of the issues that we're gonna cover in today's session include misstatements. So, where people are making false statements to a mortgage company in order to obtain a mortgage. So the risk is not being assessed effectively by the mortgage company, it might be that the mortgage company wouldn't lend to them if uh if there was an issue that, you know, that they were aware of. So it's important to make those four disclosures and that's a really basic and sometimes people see that it's been quite a minor issue about this full disclosure. However, we will see when we moved into discussing the fraud ring there. If we go back then afterwards to looking at the misstatement, it starts to put in a statement into a different context because what you might be dealing with is a fraud ring. Overall, we're gonna talk about how those ford wings work and we're gonna look at an example of how you can put one of those together or people do put them together and also see that all of the different transactions and it takes many to facilitate this type of forward in some cases can pass through the hands of many different firms of solicitors, some of them completely innocently not realizing that the chain of transactions that they're in is part of a broader chain which has caused a problem. We're also going to have a look at charges. Okay, so registering charges at the land registry is what I mean by this, not criminal charges. Now we do have to remember that mortgage fraud is a crime. And uh you know, we are going to talk about the proceeds of crime act and criminalization issues in a minute. I'm not, not minimizing that, but I am bringing in the concept of registering a charge at the land registry as a potential indicator of mortgage fraud into all of this as well. And in doing that, I'm drawing on that experience those many years of working for the regulators where I've seen all of these different cases. And very unfortunately, if you work for a regulator, you do tend to see the sharp end of the stick. You do tend to see some issues afford some issues of criminal behavior more generally, that have come before the regulator in different ways, whether it's been quite hard for people to understand what's actually happened and in some cases where solicitors have been acting uh, appropriately, but have been caught up in a wider web of something's going on. Okay, So we're gonna have a look at charges at the end of this as an indicator and and how sometimes we can see those being part of a situation that perhaps doesn't make any sense. But you start to understand how the registration at the land registry pays an important part in the situation overall. So let's start by having a look at this statement. Okay, now these are just a few examples and by no means the full range, you can have lots of different types of this statement and we'll see when we move into talking about fraud rings that any form of a statement really at all could be an indicator that puts you off balance a little bit and may need a report to the National Crime Agency and it's important we talk about that reporting mechanism at this point in the session and just so we are going to cover the proceeds of Crime Act later in the session. But if there are any circumstances in which are suspicious of criminal behavior taking place within a transaction or that people are uh dealing with the proceeds of crime in any way committing a crime in any way, they may need to make a report to the National Crime Agency. So in which case, report your suspicions. If you're a member of staff to the money laundering reporting officer and the money laundering reporting officer should, if necessary, report their suspicions to the National Crime Agency and they there are provisions within the proceeds of Crime Act to ensure that you do that and to specifically making offense for failing to do that. So do report any suspicions. And when you're laundering reporting officer the same, do then report those suspicions onto the National Crime Agency. Okay. So let's have a look at some examples of what we're talking about. And there's just a few here. I did have more on the slide, but the side became too too much to deal with. So We've got a couple here Mr A and £30,000 a year from his job. Um but he tells mortgage company a that he earns um £40,000 because he has a second income. Okay? Um so he says, actually look, I've got this pay slip here and it shows that I'm earning £30,000 a year. But you mortgage company, I lend me uh all this money on the basis of £40,000 a year. And I've told you it's £40,000 a year because I've got another job as well. But What Mr. A is saying isn't true, he doesn't have another job and he isn't earning another £10,000 a year. So he's inflated his own income in order to say that he will be able to pay the mortgage. And in fact he may not be able to do that. So the mortgage company has not assessed the risk of this situation effectively. And there can be an issue there that he's drawing down more money than he should actually be able to do. And you know why what's his intent when doing that and how does that sit? So he's not told the full the full truth there to the mortgage company to mortgage company. I mr. D. Does not tell mortgage company s about the very large personal loan he's taking out at the same time as the mortgage. So Mr. D. Is trying to uh borrow very large sums of money. Indeed. Okay. So he's taking a very large personal owner attempting to and he's also attempting to take out, you know, a mortgage at the same time. And you might become aware of these situations if for example, uh looking at credit referencing checks at the same time as when you know they're dealing with convergence overall. Um, Mr H moves jobs during the compliance but does not tell the mortgage company okay. Um, so he might have, for example, got a lesser salary. He might have taken a massive pay cut overall. And we're in the situation where the mortgage company hasn't been informed. So again, we're in the situation there where there can be some form of this statement. So um to make sure that you understand that providing the correct information to the mortgage company is important is essential and any failure to do so can be an indicator of mortgage fraud. Could be because of the application that's being made to the mortgage company which has been signed as being correct. And then there's then saying actually there is a potential issue here of misstatements in terms of what somebody's earning what somebody's debts might be their ability to repay that mortgage overall. So let's move on then to having a look at a mortgage forward ring. And this brings us into having a look at a full transaction view if you like. It brings us the opportunity to say um in this situation, many of many different law firms might be involved. There might be lots of different people that participate in this transaction and lots of different law firms. I'm trying to show you here a full transaction view. So a full way of looking at mortgage fraud and looking at the different ways in which people might make money out of that so that we're going to do that over a few slides. Okay? So if we have a look at step one, we've got the house there. Okay? Um So we've said f that's afford stuff. Okay. He's buying a house with mortgage using fake documentation, okay. But he's managed to four people who've got fake identity. Everything has been set up and it's been faked. Okay so whatever has been registered at the land registry, there is completely fake. He doesn't have the income that he says he has at all. It's all completely falsified. Okay. But he's managed to buy a house with and obtain a mortgage. So obtaining drawdown on alone for a large amount of money with that secured against property and in this case the property is real. Okay. Now we can have situations where the property isn't real at all. Okay, all people are advertising properties in different ways. Advertising properties and trying to put properties up for sale, for example that uh may exist but may, you know, there might be something wrong with them. We've seen the situations dream bar, for example, our properties, we weren't really able to be purchased because it wasn't a genuine seller. In this case we've really bought a house, but the person purchasing it is uh you know completely fake. Okay, so then carrying on through time, the house might be used for many different purposes. And sometimes when we talk about mortgage fraud in some of these cases the house can be used for criminal purposes. Okay? But in this case we're just going to say the house can be used for many different purposes. We say the solicitor at the .1 of the transaction, if we go back there, they're completely unaware. Okay, so the house was used for many different purposes but stays in the same fake ownership. Okay. Now in Step three The forward. So that's f he then decides that for example uh the house needs to make more money for him. Okay. So what he's going to do is use his fake documents again and arrange for uh fake valuation of the property. Okay? With a evaluation a larger amount. Now people sometimes in these cases make superficial um you know uh adjustments to a property in order to try to inflate its value. Um The second valuation um in this type of situation is often for a much larger amount. Okay, so with the intent of paying off the first mortgage .1 and then perhaps thinking about um you know, making sure that the property and the money is from uh you know any uh Jordan of that particular mortgage there goes across to the fraud stuff. Okay, so you're starting to look at profit there. Now in that situation then sometimes the houses left to deteriorate in which which point In time the lender then calls in the loan and finds out that the evaluation that was put on a .3 there was not correct. And also the house has been allowed to deteriorate and actually they're not going to get their security. The person that's done all of this was a fraud stand has run off and they don't know who it was. Okay. So we don't have that documentary trail in order to trace it back to them. And the mortgage company is left with security on the property that has had uh you know, that kind of activity conducted on it overall and it's not worth the original purchase price. Now this is a fraud drawing Down this mortgage here when we know, for example, at .3 that that valuation isn't worth it. But sometimes unfortunately these things can happen and we can have not only suspicious individuals involved in transactions but also suspicious professionals as well. So we have to have a look at a couple of key steps here where we can say that there is money changing hands. This is why sometimes we call it money laundering. And also we're using the word for word uh where we're looking at a couple of different key points in the process that we can highlight and say actually there's a real problem here and they're both situations where solicitors would be involved with f with the fraudster, where there would be opportunities potentially to spot that in action. So we've got f by the house with the mortgage using fake documents. So we're looking at here to establish and that's one of the reasons why we're checking identity documents when we first started the conveyance. Okay. Making sure that you understand that. We're trying to see that opening at the beginning and trying to verify. That's who somebody is. On the second point there, there's a second valuation for a larger amount and that you might get a re mortgage to pay off the original loan. Um And uh it is um uh an important point here to say that you can start to ask questions at this point in time to say, is that property worthwhile when it's being purchased? I mean, is it, you know, as a larger amount? Is that property worth what it said? Do I know the local area? Do I think this evaluation is out of keeping what changes have been made to that property in order to draw down that larger sum of money. So there can be more that we can lots of different questions that we can ask. It's also if we look that f is using those fake identity documents. Again, another opportunity to go through that process and to ask those questions in order to uncover what's happening here. Okay, So there's two different points of the process there, whether solicitors or license convinces could be involved at this point in the process and opportunities to spot what's wrong with that transaction. So if we have a look at where the money is going overall, if we have a look at that first point in time and then just don't pick this even further. We've obviously got the mortgage coming in. Okay. At this point in time when they're first buying the property and the purchase money is have then gone out to the seller. Okay. Now we can see in this situation we haven't thought about the person who sold the Property appoint one at all. Okay. You can be in a situation where if there was a fraud it was the seller involved as well. Did they know when the property was being sold that the person was buying? It was a fraudster. Okay. So we have to think in each case where those monies go, okay, who do be alive to this? If you're on the other side as well and we can start to see how those money transfer across, What does that look like to you on the other side? And people have started to ask this question about full transaction. Okay. So taking that forward transaction view and starting to say to people on the other side of the transaction, do we think that this person is genuine in terms of who they're what they're buying and we will start to see some of the indicators later in the session and mortgage ward and how you might pick that overall. So it hadn't examined the selling point one at all. But that's where the money goes in that situation. Now if we look at .3, which we also circled there, we have to think about where the money goes and again it can be helpful to map these things Out. Okay, so the remortgage at .3 there was a larger amount and it paid off the original loan. So we've got remortgage their I've got £4 signs. Some of that money has gone to the original mortgage company, but some of that money might be the opportunity for the forester to say actually I would like to do more with this property. I'd like to extend it. For example. That's why I would like to remortgage and I'll take the money for myself. But the money is for the forwards do in this case they're going to receive the cash and that's that overall pay Off. And you remember a .4 there, the houses then left to deteriorate and the security has been called in. But the forest is nowhere to be seen because of their faith documents. They walked away with that overall cash. Okay. So there was a further opportunity is an opportunity at .1 and also an opportunity at point to uh you know an opportunity at point three in order to identify those particular persons. Now we will talk about suspicious transaction, suspicious professionals, those kinds of things. There's further information relating to that within your handouts and within your handouts there's a table that I've put in there, just outlining some different things to look out for when you're dealing with these kinds of issues. For example, do we think that this is a this evaluation is in keeping? Do we know these professionals that we're dealing with? Or is it somebody from, for example, part of the area? Can you have a look on a directory of known people who do this kind of work? And do they appear on there? Do we think that these people are genuine individuals? So make sure that you understand who you're dealing with? Make sure that you understand whether or not there's some form of issue in relation to who deal with when you're looking at these types of looking at these types of issues. And how I think also as well, are you dealing with a mainstream high street lender? In some cases you might not be dealing with a mainstream high street lender if you're looking at some of these issues and people do buy from uh small lenders, property clubs, those kinds of things. So I do have a look and be a detailed understanding of who is who is approached you, you don't want to get involved in this type of mortgage forward ring. Okay, so the short version of what we've just seen there and what we can condense that down really. Somebody buys our house with fake documents and you know, eventually they can never really be traced and you might get a number of different people he saw a point to in that previous ring there that houses used for a number of different purposes and neighbors may not be able to identify who those people are, who bought that property, they may never been seen there. So there's lots of different points to put together when you're pulling all of this in and conducting an investigation. Those key points there were buying with fake documents, making changes or drawing down from a remortgage with a revaluation, much larger mortgage. Now that's a real key there, that increase in the apparent value in order to obtain access to that cash. Now a flipping is a short version of doing that. If you see say that the purchase advise the house and I've got that for £1 sign and then puts in place some superficial improvements for the houses then resold on often in quite short space of time for a much higher amount with the person who's made that superficial improvement being personally pockets the money. You have to ask whether or not those superficial improvements a lick of paint for example, really inflate their value to the means that's there. And also when you see these back to back sales for example, sometimes these things can be done really quickly and arrange purchase of some form or another might be another indicator if that and also Whether or not you see this being done in a really quick turnaround. Okay, so it might just be six months, you might be able to find information about this out on suit play, you might be able to find information about this overall to say, hang on a second, what's this happening in respect of this particular property? Why? You know, let's have a look at these photos. Uh the estate agent particulars. You might be able to go back six months and see whether anything has been done at all. So living can be legitimate. Um it can be something where people buy the properties in order to make major changes and including major structural changes which definitely do add value. We've always seen properties on the market that you know part of the Gary just started to fall down for example or uh you know the roof needs repairing and if you did that then it would stop some of the leaks in the house and you know, you'd be able to re plaster, you know, rebuild part of it and you start to say, well actually and that sort of situation, Yes, you can see how the value is being added but a lick of paint and uh those kinds of things where real investment has been made for example in kitchens and bathrooms, you can say actually you can see why people have put the time and effort into doing that. Having said that you're not. If the value isn't being added, you have to ask whether or not this is a genuine purchase at the higher amount and whether the mortgage company it's genuinely aware, not forgetting of course the convents or is acting both for the client and also the mortgage company as well. Now let's take this situation back. Okay so remember at the beginning we talked about misstatement Step one on my journey there was for the fraudster to buy the house with a fake identity. Okay now we need to just think about my statement. Okay. Have any of those things that those people have done their you know uh drawn your suspicion overall if you've got misstatement, you know, buying a house with a fake identity might be a massive case of misstatement in a sense. So you just have to bear that in mind when you're thinking about this. Um Do you think his misstatement just one part of this? Do you need to question that transaction overall? Could this be just the flag that you found to say that this isn't a real person or there is something wider wrong with that transaction overall? You might just have found that key in there when you're dealing with this statement? It obviously is an issue of mortgage forward on its own. But do you consider the whole position and what else? You know because that one issue can be indicator of a wider problem. And you might be dealing with that example of that ring that we've just already seen here now. These things as I already said in the beginning can be really really complex, Can be deliberately complex and really confusing. You think you've lost your marbles a little bit when you're trying to unpick what's actually happened in this situation, but I can't understand it, why has unearthed this has happened. And who are these people is often the reaction that you have as somebody looking at these types of situations. So do be aware of that when you're dealing with the situation. But sometimes thinking about that process overall can give us a different view when we're talking about this statement. Now let's move on then to talking about charges and how we're dealing with charges overall. We've got a situation here where Mr. T. Is acting for a new purchaser and he's going to register a charge. The property for their mortgage. Uh I'll wait, the property has gone through its been purchased. I need to now register the new mortgage. Oh hang on. There's a charge and it's it's already there, there's already there's already a charge there. Now, hang on, this should have been paid off in the undertakings. And I'm looking at you know the person that sold the mortgage that charged should already have been discharged by now, you know that that property was sold a little while ago. So uh they need to get a bit of a big along. So this was a really common issue for me when dealing with these types of cases. Um and you did see it linked a lot of the time two different issues and was investigated and resort different issues when talking about mortgage forward. So um there can be issues and indicators of a wider problem when we're dealing with this type of issue. Um the failure to pay off mortgages by the seller's solicitor when we're talking about issues related to code of conduct and these apply to um solicitors and license convinces reach of undertaking can be raised with people breach of fiduciary duty, failure to act with honesty, integrity or complete a proper standard of work can all be raised as well if somebody is involved in a broader scam where there is some issue here um to try to prevent registration of property, try to continue holding the property, it could be a criminal offense. Now we have to take a step back and ask ourselves, we talked about this before, we talked about whole full transaction views. You have to just take a step and take a step back and say I'm off to register a charge, but I can't because the previous persons charges still there then take a step back and examine your involvement in the transaction overall as well and say, do you think in this situation that the new purchaser is genuine? Okay, do we know of any connection between the two of them? Is there any reason why they would want to prevent the mortgage company registering their security? Have we just have a clear think about that situation and do remember some of these situations can be deliberately complex. So it is important to think about making a report if you need to, that could be a report to the National Crime Agency. It could be report to the regulator. As we've said here, there are issues that could be involved. It could be a criminal offensively seeking to prevent people registering their charge or seeking to manipulate the convincing system in different ways. There can be examples of fake firms and also we do sometimes suspect fake firm rings for the whole. So the different ways in which people work together. There may also be an indicator. If you're dealing with somebody who's mortgage hasn't been paid off, think about the client account as well. So, you could be dealing with issues of account problems within a firm or it could be an indicator of a wider problem of management. Okay. It doesn't matter. Um, if you're dealing with the other side is being a cash buyer, if the charge is left on their property, there still remains to be an issue. Okay, You don't want that there anymore and it has to be paid off. Okay, So it all could be part of a broader issue which can be linked across to issues of mortgage fraud. So preventing people failing to pay, uh, preventing lenders registering their security. So, people, you know, sitting in the house without that security being registered, there can be issues. They're relating to the money is not being paid off the original charge and where have those money has been paid away instead. Okay. So there can also be issues there and we have to think about how the first example there we followed the money. Where has the money been paid instead of being paid to the mortgage company of the charge hasn't been discharged. Yeah, So there could be reason to suspect dishonesty intervention prosecution. As I said, there could be criminal offenses involved. And depending on the extent of the situation, there can be other issues related to tax evasion sometimes as well, and criminal offenses. Don't forget that you have to make a report if you're suspicious overall and that there can be very serious consequences. So just stop and think about your part of the transaction. We examine that. Are we satisfied as to who we're dealing with? And it's a genuine client and they would genuinely like to register their mortgage. There isn't anything wrong with your partner transaction in addition to what's in there one as well, when we're dealing with charges, it's important to remember that there isn't a clever way around the system for undertakings, you may have to comply with that. So, there isn't some different way of doing this that allows you to not register charges not to comply with your undertakings in the code of conduct? In the in the code of completion by post. Do you make a report if there was any issue of non compliance because there can be um issues there as we've already said, and it can lead to people questioning who's receiving the money while lenders can't register their new charges and also where those monies have been paid away to. Um And so if you're at all suspicious of the situation, you have to make a report, the National Crime Agency. And you know, if you're internally within a firm, you might then make it to your money laundering reporting, sir. He then has to make it to the National Crime Agency. Don't forget to comply with your undertakings overall, Make sure that you check the bona fide is again, of the sellers and purchases if you're in the situation and that can be part of your reporting process because there can be an indicator when you do deal with that. How can we prevent these issues from happening um when you're dealing with and this goes for mortgage forward as a whole and potential issues and mortgage forward do understand what properties people are buying. Okay. Do you know your area? If you're in a local area that could be really, really beneficial. Is that one worth it? Do you know where it is? Okay. Have there been improvements? Is it a good road is a bad road? What does it look like to you on the outside of that? And what do you know about it? Okay. And you can also visit people as well, you know, uh don't be afraid to use these things as tools, official tools. We say we've now started a process of home visits as well to verify people are actually living at the property and go and ensure that that's actually what's happening can be a good another good means of checking that you're dealing with, Who you say you're dealing with. Um So what are some of the consequences of this situation? We've mentioned the proceeds of Crime Act. Now I've put mortgage forward to one side as a crime by the client. Okay, So that is a crime by the client, regardless. We're just drawn a line there. But what we're talking about on the other side of that line there, the other consequences is how that has consequences for the firm criminalization of the individual solicitor in the firm. You could be handling the process of crime. It could be an arrangement. Okay? So if you acquire the proceeds of a crime, you're looking at Section 3 to 9 of the proceeds of Crime Act, arrangements are covered in uh section 3 to 8. And arrangement is anything at all that where you've entered into any situation at all? Where the process of the crime, a crime are involved and it is really wide wording any step at all that you take towards furthering that criminal purpose poses an overall problem. So uh results in the criminalization of the firm. So just that's why I said take a stop, take a breath re examine the transactions overall. And do you think about what you're doing? You're in that situation if you're dealing with the charges situation or any situation relating to mortgage forward due to stop and take a breath and then think about whether you need to make a report. You can take legal advice if you need to and if you are listed have a look at the solicitor's assistance scheme which provides advice to solicitors and their staff. Uh Now there can be other combinations of this and other sections of the proceeds of Crime Act which is applied. But this really isn't a session about anti money laundering. Um It's just a highlight the necessary necessity to make a report to your money laundering, reporting officer and the National Crime Agency as necessary. So just re emphasizing that point and I keep saying it is really important. Uh staff must disclose their suspicion to the money laundering reporting officer and it's a criminal offense if they don't do so the money laundering, Reporting officer must disclose their suspicion to the N. C. A. The National Crime Agency and again a criminal offense if it's not reported. So that brings us to the end of today's session. Now after this slide we're going to just talk about the flipped classroom. So at the end of today's session we've just talked about the types of mortgage forward and we've looked at some examples of mortgage forward. And in particular we've looked at misstatement. We looked at mortgage forward wings and we've gone through the details of one of those wings there. We've also looked at flipping the shorter version. Okay. Which can be legitimate sometimes but also as a convenience. So you might have to bear in mind that you're acting for the mortgage company and you're also acting for you know the person involved in the transaction as you know if you're active to purchase. It isn't genuinely a good by that they're buying. So how do you think about the advice that needs to be given there? Um We've talked about the process of Crime Act and how that applies. And and I should also mention this isn't an anti money laundering session but there are sections in there relating to tipping off as well. So if you are in a position where you have to make a report, you may need consent to proceed before you're able to go ahead with the transaction and you may not be able to say anything to the client at all concerning tipping off. Uh you know about the report that's been made or any forthcoming investigation. So just be aware and do watch a further session relating to anti money laundering if you need to. I've also talked about charges at the land registry and now we're gonna move on to the flipped classroom which is what you can take away from today's session. So in your handouts I would like you to have a look at those and the handouts cover a flipped classroom. Okay. And what that is is the opportunity for you to take today's session and then implement that and then have a review of how you feel about you know, some of those issues that have come out today's session I think about have you learned something from today's session? What did you learn? How did you feel about that? What needs to go into your personal development? Do you want to learn anything more? And one of those things might be for example watch a session on anti money laundering for example to make sure that you've understood that process is a separate process. What I'd like you to do for your task in today's session in this further information is available on your handouts with more examples of the types of scams and issues that you can look out for is to review policies and procedures and or your risk assessment for anti money laundering and make sure that you're covering or encompassing some of the issues that were covered in today's session. So you might pick out some of these as relevant. So you're I can't tell you what to put in your risk assessment because each thing has to be relevant to you overall. So I. D. And checking financial statements by the client for disclosure to the mortgage company um for transaction views short ownership uh might be a good indicator. Home improvement, non discharge of charges. Okay. And then try to have a think about your policies and procedures over how you're going to deal with that situation and as I've said that might necessitate further discussions around anti money laundering. Okay And then the second point cool. The 2nd point on your handout is too. Mhm. And then the second point on your handout is to communicate that to the staff. Now haven't put that here on the slides but there is the option for you to say how are you going to have that discussion with your staff in order to communicate what you've learned in today's session and how can you then take that away and have those discussions with your staff in order to raise awareness and also implement those policies and procedures. So do have a look at that. There is more information in the notes that accompanied today's session or the hand. And that hand out really is focused on the flip classroom but there's more information about different types of scams and different types of issues that you might put into your policies and procedures. And also um just further indicators that you might be dealing with some form of fraudulent situation. That's all for today's session. Thank you very much. Thank you very much for watching.