New bank probe is golden oppportunity to revive FCA’s reputation

So - just for once - it is heartening to see steps being taken in the right regulatory direction. A host of mis-selling scandals have rocked the financial services sector over the last decade. Politicians and analysts have been driven to distraction by regulators’ failure to get a grip and haul miscreants over the coals.

But we can all take heart from the letter sent by Nicky Morgan, the chair of the Treasury Committee, to both the Financial Conduct Authority and the National Crime Agency.

She is demanding a thorough investigation into allegations about criminal activity in the banks “whereby home repossessions and other such documents are not being signed by the authorised signatory.”

Andrew Bailey, chief executive of the FCA, was previously asked questions about allegations of potential criminal activity occurring at banks,

Steve Baker MP said previously that he had been shown evidence that “in certain business processes, such as home repossessions, the act of delivering capacity for these business processes might mean that paperwork is signed by somebody who is not the authorised signatory within the bank before taking possession of someone’s home.

“I have been shown various signatures that demonstrate that it is clearly the case that within some institutions processes are taking place where it appears that anyone is signing these documents.

“Whether or not the repossession is justified, it does seem that is therefore a fraudulent transaction.

“Are you aware that this phenomenon may be happening? If so, what are you doing?”

Mr Bailey said: “I am aware of it. Yes, it does get talked about. If you would like to bring the evidence to us, we will look at it.”

Ms Morgan has done the right thing by urging Mr Bailey and Lynne Owens, the director general of the NCA, to engage with the Bank Signature Forgery Campaign to review evidence it has gathered in recent months.

This action is a vindication of the work of Kevin Hollinrake of the All Party Parliamentary Group on Fair Business Banking, (APPG) who believes we could learn from investigative work carried out in other countries, where large-scale bank signature forgeries have been exposed.

The APPG said it is supporting the Bank Signature Forgery Campaign because the group receives “frequent and consistent” representations from constituents with concerns over the possible forgery of signatures.

The campaign aims to provide a vital method of gathering evidence of possible signature forgeries by UK banks in court documents.

Anthony Stansfeld, the Police and Crime Commissioner for Thames Valley Police, has also announced his support for the campaign.

To quote the APPG: “Signatures on the Statements of Truth on court documents are a foundational aspect of the UK justice system and lawyers have been struck off the Roll of Solicitors for forging them.

“These processes of law cannot, and should not, be subservient to process that ‘speed-up’ the repossession of property by financial institutions.

“The industrial-scale forgery of signatures on banks’ court documents against customers has been exposed in national scandals in other countries.

“ In the US, an investigation by all 50 State Attorney Generals resulted in penalty payments by US banks of $25bn and a review of four million court cases against customers. The US Department of Justice described the penalty payments by banks as the largest consumer protection settlement in United States history”.

The campaign is encouraging personal and business customers who have received a bank court document from any UK bank or finance company to send a photo or photocopy of the bank signature to the campaign.

The ball is now in the FCA’s court. It’s a golden opportunity for the regulator to revive its reputation, which has been battered so badly in recent years.