Brokers banned over fraud
The Australian Securities and Investments Commission (ASIC) has permanently banned three Sydney-based mortgage brokers, Xiaoyi Zhao, Jun Ma and Liang Zhang from engaging in credit activities following an investigation that found they had provided false pay slips to Westpac on behalf of customers to lodge home loan applications.
ASIC alleged the brokers, who worked for Sydney Global Investment, formerly X Finance Group, were knowingly or recklessly involved in the provision of false employer letters and/or pay slips to Westpac Banking Corporation to support 21 home loan applications lodged on behalf of customers.
The investigation found the companies nominated in the letters and payslips were based in China, customers concerned were not employed by these companies, and the payslips provided income figures that were much greater than the customers’ actual incomes.
In relying on these false documents, Westpac financed over $17 million in home loans.
The investigation confirms that while brokers were concerned the recent Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry would damage their reputations, greater industry scrutiny by the regulator could improve industry standards.
A MyState Bank survey conducted in April found that 37 per cent of brokers were in support of greater scrutiny, with 17 per cent noting the scrutiny would be unfortunate but necessary.
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