Property agent hit with £1m fine for defraud

THE Financial Conduct Authority (FCA) has fined a property agent nearly £1m for defrauding vulnerable people, the largest-ever fine for a sole trader in the consumer sector.

The FCA also banned Gurpreet Singh Chadda from working in the financial services industry for the way he conducted sale and rent back agreements that netted him £695,277 from seven transactions.

The agreements refer to where a homeowner, often in financial difficulties, sells and then rents the property back from the agent so they can still live there.

Sign up to our Business newsletter

Sign up to our Business newsletter

The FCA’s £945,277 fine included the whole sum defrauded. “Chadda’s misconduct is the most shocking we have seen from a home finance arranger,” FCA director of enforcement Tracey McDermott said. After a probe of seven sale and rent back transactions, the FCA found Mr Chadda had told customers he would be buying their home when in fact the purchasers were other people.

Two homes were valued at significantly less than actual market value, while in two cases the seller received just over a third of the sale price of their home.

Mr Chadda, based in Birmingham, helped one buyer of a property to mislead the mortgage lender by drafting a letter that falsely confirmed the seller would not be staying in the property, the FCA said. While being probed by the FCA, Mr Chadda also made false and misleading statements, and arranged for people to impersonate his customers to hoodwink the watchdog.