More mortgage brokers allegedly involved with shadow lender, says provincial regulator
B.C.'s registrar of mortgage brokers has named more people allegedly involved in questionable borrowing to purchase homes, which contravenes the province's Mortgage Brokers Act.
On Thursday, the Financial Institutions Commission of B.C. [FICOM], the head organization of the registrar, made public the notice of hearings for an unregistered broker who, it alleges, facilitated loans through two registered brokers.
FICOM says unregistered mortgage brokers put consumers at risk and there is the potential that personal information will be misused.
It also says that registered mortgage brokers who engage in this practise "undermine public confidence in the mortgage broker industry."
Not authentic
The regulator alleges that registered brokers Grant Brian Curtis and Tanya Ann Smith took instructions and information from Dean Frank James Walford — who has faced a cease and desist order before — on mortgage applications.
The registrar says documents submitted to lenders by Walford were later determined to "not be authentic and which resulted in the economic loss to the lender."
The instances of so-called "shadow mortgages" are the second to be made public since May, when the registrar issued a cease and desist order again Jay Kanth Chaudhary.
The registrar alleges Chaudhary worked with others to arrange home financing for people who would not normally qualify for a mortgage by altering federal tax forms and other financial documents.
The cases illustrate that there are home-buyers in the province willing to break the rules to qualify for a mortgage.
In this latest case, the registrar alleges Walford submitted applications to lenders on behalf of borrowers relating to 90 properties. It also says he created applications for borrowers pertaining to 114 applications.
Cease and desist
The registrar issued a cease and desist order related to Walford and the company Loan Depot Canada — also listed on the notice of hearing — in 2011. There was an industry alert about the order in 2014.
Still, the registrar says in its notice of hearings that both Curtis and Smith allowed Walford to have input on mortgage applications related to borrowers' employment, income, credit checks and other personal information.
It alleges that neither Curtis nor Smith contacted borrowers to verify the information and submitted it to lenders in support of mortgage applications.
Sunshine Coast
The registrar alleges that Walford continues to identify himself as a mortgage broker to the public through the social media platform LinkedIn, which identifies Walford's location as Roberts Creek. On that same page, he's listed as a former president of the Gibsons Chamber of Commerce and a scout leader.
According to FICOM's database, Smith is registered with Dominion Lending Centres Mountain View Ltd. in Coquitlam. Curtis's name does not show up in the database, but online, his contact information appears to show he is related to the same lending centre as Smith.
When contacted by CBC News, Curtis did not offer a comment or respond to the allegations.
CBC News has not been able to contact Walford or Smith.
FINCOM says people conducting or facilitating an unregistered mortgage broker business can receive administrative sanctions, which may include financial penalties up to a maximum of $50,000, plus investigation and hearing costs.
The allegations contained in the hearings are unproven until the registrar is able to determine their validity through an adjudication panel.
