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Mortgage Broker News | 29 Jun 2010, 09:16 AM Agree 0
A Toronto woman is being ordered to pay RBC $95,000 after failing to realize she was being tricked into a mortgage fraud.
  • steve kates | 30 Jun 2010, 12:50 AM Agree 0
    the agent for royal bank commited the fraud and should have been charged as well
  • joe | 30 Jun 2010, 12:54 AM Agree 0
    wow...there ARE actual DUMB people out there.
  • Jake | 30 Jun 2010, 12:56 AM Agree 0
    I have zero sympathy for this person. Her actions in the name of greed, ($6000) for signing her name have consequences.
  • Kevin Power CPMA | 30 Jun 2010, 12:58 AM Agree 0
    People in the mortgage brokerage industry are constantly being painted with lack of ethics brush (sometime correctly) but bank employees and mortgage specialists have their own issues. Most notably the cash back scam where the borrowers don't even see it. The banks internal audit department should be taking a much closer look at this file.
  • Greg | 30 Jun 2010, 01:20 AM Agree 0
    It sounds like the RBC needs to do some house-cleaning, and the judge should possibly have held the bank and the lawyer involved at least partially responsible. I would be interestd to see if there was a claim to CMHC that was denied. It is also interesting that a property bought in 2004 lost so much money upon resale some 4 years later in the market we just went through. There are a lot of questions I would like answered.
  • Black Jack | 30 Jun 2010, 01:34 AM Agree 0
    RBC should use third party mortgage brokers insteat of their in house mortgage specialists to reduce the scandals!!!
  • Marjorie Stewart | 30 Jun 2010, 01:44 AM Agree 0
    I'd like to know why RBC approved te mortgage if this woman was already in financial difficulty - however she knew what she was doing was illegal so shame on her!!
  • Gregg | 30 Jun 2010, 01:53 AM Agree 0
    The Royal and the client and co-signer had no intermediary, they knew what was going on from the git go, the closing was probably done through a title company so no independent legal advise was given to this co signer. I do believe the co signer has a responsiblity due to the greed she signed the documents, but if a Lawyer was involved that would have been exposed and things may have been different. I do not agree with chartered banks signing in house, they are driven to close deals, not protect the investment or the clients. How many times have banks closed in house with in ILA to parties that should have had it. Fiduciary duty or responsiblility doesn't apply to the banks I guess. Well thats my rant
  • mortgage needs | 30 Jun 2010, 02:47 AM Agree 0
    and rules as independent mortgage brokers ?
    Such a move may be good also for the banks as a check & balance for themselves.
    All the talk about financial stability, and this is where we start - on the ground.
  • ABC | 30 Jun 2010, 02:56 AM Agree 0
    Serves her right for co-signing a complete strangers mortgage! WHO DOES THAT!?! People will do anything for money these days and you would think people were smart enough not to fall for such an easy scam.

    Did you not see all the red flags being raised when the STRANGER asked you to co-sign. HELLO! I'd say use your brain next time but she clearly doesn't have a properly functioning one.

  • Mike From Marmora | 30 Jun 2010, 03:34 AM Agree 0
    If this woman DID NOT HAVE have ILA, no matter how greedy/stupid/or a scammer she may have been, I don't think she should have to pay.

    The Lender has a duty to their owners/shareholders to do reasonable due diligence & in my humble opinion that means anyone who is going to co-sign or guarantee a loan or mortgage & will not directly benefit from the mortgage/ loan, should have independent legal advice.( I would be very surprised if this is not an existing lending policy of RBC)
    If she had ILA then let RBC collect the money, if not then let the shareholders look to the incompetent management that allowed this situation to occur.

    If she did not have ILA, there has to be an under-employed lawyer who wants to make a name for him/her self & appeal this decision.
  • Russ From Vermilion | 30 Jun 2010, 04:01 AM Agree 0
    Not to pick on RBC but doesn't make you wonder why they are almost always involved and taken advantage of..their staff are great and should not be critized..but most of them do a lot of other things and work in Mtges when then can except for the specialist and they have no excuses. It's simple RBC hook up with the broker network and you can have professionals who do mtges full time and are directly accountable as they are subject to audits and other brokers will turn you in if they see anything suspect, in a second. I've taken a lot of business away from RBC as I can send business to them.. so think about it....it's a win/win// thanks Russ
  • Sean Binkley AMP | 30 Jun 2010, 04:06 AM Agree 0
    RBC should be responsibile for the enitre loss and the employee fired if there was no ILA for a non-related party to co-sign.
  • Jake | 30 Jun 2010, 04:29 AM Agree 0
    The deal was submitted to RBC by a broker who charged a huge fee. I just read the whole Court file and the deal was initiated by a broker who it appears fabricated the false documents. It is a little unfair to claim brokers are Holier than thou. "The mortgage broker, realtor and lawyer involved all received exceptionally large fees".
    This fraud was perpetrated by a broker, a lawyer (who is under review by law socitey) a shady Realtor and a dimwitted acconmplice who was left holding the $95,000 bag. Even though the majority of brokers are beyond reproach, there are some bad apples in the bunch. I do not work for RBC, but put the blame where the blame is due!
  • AB Mortgage Broker | 30 Jun 2010, 04:40 AM Agree 0
    Does this really surprise anyone? I've come to expect this from RBC and BMO. Oops, did I say that out loud... If our industry was regulated as tightly as the financial planners, perhaps the big banks would take us more seriously. Let's face it, as brokers we ALL know of other brokers, or leeches, that are guilty of the same. They like to hide behind the AMP, which has absolutely zero meaning behind it, and the big brokerage houses who protect them.
  • Allan | 30 Jun 2010, 06:05 AM Agree 0
    I doubt the lack of ILA will save this woman, as she DID receive consideration ( $6000 ) from this transaction.
  • Allan | 30 Jun 2010, 06:05 AM Agree 0
    I doubt the lack of ILA will save this woman, as she DID receive consideration ( $6000 ) from this transaction.
  • Allan | 30 Jun 2010, 06:05 AM Agree 0
    I doubt the lack of ILA will save this woman, as she DID receive consideration ( $6000 ) from this transaction.
  • Mark from Mimico | 30 Jun 2010, 06:54 AM Agree 0
    Interest rate looks like posted for the time....so was there cash-back? Who got it? the realtors? the mortgage agents? If some one other than the borrower/cosigner rec'd the cash-back, did RBC pay that party a secret commission? If they paid a secret commission to a third party without the consent of the borrower, should they get the full $95K back? Should they get anything back if they committed a criminal act by paying an undisclosed secret commission?
  • Former Broker | 30 Jun 2010, 08:08 AM Agree 0
    It's interesting how everyone assumes that the RBC Mortgage Specialist had a hand in this. She signed the documents knowing that she was co-signing a mortgage. The end result is that she was greedy for accepting money to co-sign for a mortgage. There are also a few independent brokers who fraudulently produce documents to support lending criteria so let's not point fingers.
  • Real Broker | 30 Jun 2010, 11:03 AM Agree 0
    Let's face it. There are questionable brokers and mobile sales force. I know of a situation where for a large fee a mobiler connected a client with an accountant who created false income docs, a Realtor who listed on MLS with a jacked up price so it could go through CMHC emili for valuation and get the client the property. The client made his income from growing. I wouldn't touch the client and provided no suggestions how it could be done but someone else in the same line of "employment" hooked him up with the RBC mobile. Just last week confirmed after 4 years the RBC mobile is still there. I've seen lots of other deals where what they accept for docs is very questionable. Clients that I couldn't get approved were getting mortgages from RBC.
  • NB Broker | 30 Jun 2010, 07:36 PM Agree 0
    I agree with many of the above comments about RBC Mobile Specs. Now it's the no down/gift letter/ cash back. Many clients are only providing a gift letter, no funds ever on deposit and being appoved with CMHC as a gifted down, then using the cash back for the down. Also seeing modular home dealers stating a 5% deposit given at contract signing, increasing
    price of home accordingly and it being processed as a 5% down deal with a gift letter. I want to know why they are not audited. When I worked in Branch Banking we lived in fear of our annual audit!! The above case of co signing for a 6000 fee does not shock me nor do the comments regarding falsifying of income documents. What shocks me is that they are getting away with it.
  • Jags | 01 Jul 2010, 04:32 AM Agree 0
    I agree with Jake that there are still crooked brokers out there. Its a good news that these things are getting out and something is done . Broker involved and the RBC's staff who are involved should be punished as well then only this will stop.Punishing that lady will not make any difference.
  • Zoltan M. Padar | 02 Jul 2010, 01:55 AM Agree 0
    Obvious she has commited fraud and to be punished, however the rest of the people responsible will get off scott free? This file has involved more then just this lady, matter of fact, the others were the real perpetrators. Mortgage Borker for the bank, tha lawyers, the original buyer, most likely the seller and all has put this fradulent file together should be all share the blame. Also the bank had to sell that property with such loss, when property values are relatively levelled off? Of course, the BANKS are allways right. And you know why? Becouse they can afford to pay a herd of lawyers.
  • Pepper | 04 Jul 2010, 10:18 PM Agree 0
    It isn't difficult to determine the posters who are mortgage brokers here. If one takes the time to read the legal document posted by Mark from Mimico, it is clear this transaction was initiated by a mortgage broker, who referred the client to an RBC mortgage specialist. The names are clear for all to read. Ironic: the RBC MS is now a Mortgage Broker.
  • Ronald | 07 Jul 2010, 12:32 AM Agree 0
    All parties to this transaction knew something was wrong, the bank should have looked more carefully, the client was greedy and the lack of ILA should have told you to stay away.
  • Brett | 07 Jul 2010, 03:17 AM Agree 0
    RBC reps have lending limits - that if there is a good credit score - allows the reps to "sign off" on income verification without having to retain the actual income documents. That's why they needed her (the one with the good credit score) to be party to the file. On a purchase, many lenders require that a co-signer live there...but guess what... Put her on as the primary and lie (as the rest of the app was a lie) that she'll be living there and 1. Principal res issue gone and 2. she wouldn't require ILA - the true fraudster would as he is now the co-app!!!
  • Brett | 07 Jul 2010, 03:20 AM Agree 0
    RBC reps have lending limits - so if there is a good credit score - allows the reps to "sign off" on income verification without having to retain the actual income documents. That's why they needed her (the one with the good credit score) to be party to the file. On a purchase, many lenders require that a co-signer live there...but guess what... Put her on as the primary and lie (as the rest of the app was a lie) that she'll be living there and 1. Principal res issue gone and 2. she wouldn't require ILA - the true fraudster would as HE is now the co-app!!! RBC typically doesn't claim through CMHC - which is why they were suing her and how they get lending limits and the ability to not forward on the required docs for verification. If I'm wrong, sorry, please correct my statements.
  • Brett | 07 Jul 2010, 03:25 AM Agree 0
    Oh - by the way. Broker's FSCO fees went through the roof last year so they could better police claims of fraud etc. Until we start seeing real teeth and fines that you see against brokerages in the real estate community it will be the good guys paying for the bad...AND worse still is that the really bad apples just find token chumps to funnel their business through - most of whom don't even bother to hold a license.
  • P.J.Hennessy | 05 Dec 2010, 01:51 PM Agree 0
    Can a cosigner of a morgage document or contract pull out of the agreement before morgage is paid in full ?

    What if any are the possible negative results of pulling out ?
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