Rise in mortgage fraud complaints in B.C. as house prices jump

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A review of B.C. regulatory filings points to a growing number of mortgage fraud cases involving fake incomes, phoney offshore collateral, and false tax information in schemes allegedly connected to real estate professionals operating in B.C.’s growing shadow banking sector.

Postmedia reported Saturday that shadow lenders — non-banks that are not federally regulated — have rapidly increased their share of Canada’s mortgage market in recent years, as Ottawa has tightened lending standards for Canadian banks. Many of the big loans issued in Vancouver prior to 2017 won’t be insured again, a Bank of Canada risk report says. As a result, according to a number of experts, an increasing number of borrowers are turning to shadow banks for loans in Vancouver’s hot market, and the private lenders in this growing sector are more prone to fraud and careless lending.

Chris Carter, B.C. registrar of mortgage brokers at B.C.’s Financial Institutions Commission, or Ficom, said the agency is experiencing an increase in mortgage fraud complaints, and “recently recruited dedicated staff to implement a more ambitious program of risk-based examinations.”

Read more at Vancouver Sun

This article is summarized by Canadian Fraud News Inc.