The FSA worked closely with Northumbria Police and the Solicitors Regulation Authority (SRA) in this investigation which involved a significant number of individuals across a range of financial, property and legal businesses in the Newcastle area.
The ban of NHL was the final part of the FSA’s action in relation to NHL and connected individuals. Earlier this year the FSA fined NHL £170,000 for submitting false information in mortgage applications and for allowing David Purdie to act as its chief executive without FSA approval. NHL failed to pay this fine. The FSA has also banned NHL’s directors Linda Patterson and Grace Darling Purdie, and fined Mrs Purdie £85,000. Other individuals involved have also been banned - David Purdie, the shadow CEO, and mortgage introducers Michael Foster and Kenneth Robinson.
NHL was used by its principals and by the mortgage introducers knowingly to submit mortgage applications to a lender which contained false information. This resulted in the lender unsuspectingly advancing sums which, in some cases, were considerably higher than the purchase price of the property.
Margaret Cole, FSA director of enforcement, said: “The failures at NHL were serious, deliberate and occurred as a matter of routine. Its principals acted in a totally unacceptable fashion and their actions and the actions of those connected to the firm posed a serious risk to the lender and to market confidence generally.
“In the last three years we have banned 60 brokers and levied fines totalling more than £1 million in relation to mortgage fraud. We will continue to tackle mortgage fraud and perpetrators will find themselves facing bans and higher fines.”
Northumbria Police recently arrested Grace Darling Purdie, David Purdie, Linda Patterson and Michael Foster, among others. Its investigation, and that of the SRA, continues.
The FSA’s investigation found that the individuals involved were not fit and proper and should be prohibited from any further involvement in regulated activities or authorised firms. In relation to Grace Darling Purdie, the FSA also found that she failed to exercise due skill, care and diligence in managing the business of NHL and took no steps to satisfy herself that the business was being conducted in accordance with regulatory requirements.
