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Broker saves clients in $200k loan fraud

by Nick Bendel10 minute read
The Adviser

A Melbourne broker has swooped in at the last moment to help two loan fraud victims save their house after a four-year battle with their bank.

Loan Market franchisee Stephen O'Reilly-Nugent said his clients had been the victims of a notorious conman who had falsely presented himself as a broker so he could steal their identities.

The conman snared Mr O'Reilly-Nugent’s clients in 2010 by advertising himself as someone who could save them money by refinancing their loan, he told The Adviser.

The conman then used their documents to forge their signatures, steal their identities, remove them from the title of their property and withdraw more than $200,000 from the loan, he said.

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“Six months after the refinance took place, when the customer received their first home loan statement, it was in the name of somebody they had never heard of,” he said.

Mr O'Reilly-Nugent said that triggered a “four-year scrap” with the lender, which refused to accept his clients had been defrauded and insisted they repay the entire loan.

The Adviser has omitted the names of the conman and the lender while the case is still before the court.

Mr O'Reilly-Nugent said he was brought in on the case two months ago when the two borrowers were on the verge of losing their home. His job was to find another lender to take over the loan.

“It had been shopped around. Other brokers had looked it. When I was asked to intervene, it was with a private funder and going nowhere,” he said.

Mr O'Reilly-Nugent said the loan was transferred to Pepper, which took the time to understand a complicated case that would otherwise have been an “instant decline” for the credit officers.

“The clients seem to be pretty happy. It’s definitely a weight off their shoulders,” he told The Adviser.

“The bloke has looked sick and ill and stressed the whole time I’ve been with them. She’s a pensioner, so it’s not a particularly good story.”

Meanwhile, new research from Veda has revealed credit application fraud is now at its highest level since 2009, with identity takeover growing by 103 per cent from 2012 to 2013.

Identity takeover represented 26 per cent of identity fraud in 2007 but 89 per cent of all identity fraud in 2013, according to Veda.

“Fraudsters have adopted identity takeover as a technique, in preference to creating fictitious identities, because improvements in identity checking practices and technology have made creating bogus identities far more difficult,” Veda said.

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