Not upheld: Credit file / adverse marker disputes complaint against Bank of Scotland plc trading as Halifax

Decision detail

Summary

Mr and Mrs F applied for a mortgage through a broker in October 2024 and received an offer in November 2024. Unknown to them, the first broker impersonated them, falsified their income information, and submitted fake payslips showing Mr F earning £186,000 and Mrs F earning £42,000, when their actual household income was around £25,000. Halifax lent them just under £940,000 based on this false information. After the mortgage completed, Halifax discovered it could not verify the income and reported fraud markers to Cifas. Mr and Mrs F complained, arguing they were victims of fraud. The ombudsman found Halifax had reasonable grounds to report the markers based on the false application documents it received, and was not required to detect the third-party impersonation. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Halifax had reasonable grounds to suspect fraud when it received a mortgage application in Mr and Mrs F's names supported by false income information and fake payslips. Although Mr and Mrs F were themselves victims of broker fraud and impersonation, Halifax was not required to detect this and was entitled to report the markers based on the false application documents it received. The ombudsman noted that reporting to Cifas requires only reasonable suspicion, not proof beyond reasonable doubt. The ombudsman also found it likely that Halifax's verification letter was sent to Mr and Mrs F's home address, even though they claim not to have received it.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website