Fraudulent mortgage broker banned

Fraudulent mortgage brokers are being targeted by the FSA

A mortgage broker who tried to defraud insurance firms of more than £250,000 has been banned by the Financial Services Authority (FSA).

The broker, Peter King, ran the New Forest Mortgage Company in Bournemouth.

He made 39 bogus applications for life insurance policies so that he could pocket the normal broker commissions paid by the insurance firms.

The FSA said it would have also imposed a substantial fine on him, but for the fact that Mr King is now bankrupt.

"Peter King acted dishonestly and without integrity and posed a risk to consumers and to confidence in the financial system as a whole," said Margaret Cole, the FSA's director of enforcement.

"The FSA will not hesitate to take action against individuals or firms who break our rules and put customers at risk of fraud."

Of the 39 fraudulent policy applications, which were all made after June 2007, 30 were in the names of people who did not know anything about the applications or who simply did not exist.

"The names used related to real people, such as your family, friends and former clients," the FSA said.

The regulator said King had made the applications so that he could use the commission money to invest in properties.

His scam was tipped off by one of four insurance firms which suspected that the applications made to them were bogus.

At the time of the fraud King was the only director at the firm.