FTAdviser.com

Advertising

We would all like to think we work in an industry that is above reproach and totally professional but unfortunately this is not the case.

It is a sad fact of life that there will always be a small minority who will try to beat the system.

The FSA, along with the rest of the industry, needs to be vigilant in making sure controls are in place to counter fraud but it is difficult to legislate against the whole industry for the behaviour of one small group.

There will no doubt be set minimum and maximum fines imposed so it stands to reason that in some cases the offender may not feel the financial impact of any fine imposed.

The FSA and lenders have systems in place to ensure fraud is picked up at the application stage, stopping potential fraud. This begs the question: do you impose fines for potential or actual damage?

Application fraud could be more appealing than ever to those on the fringe of the industry during hard times and the FSA needs to be on its guard as the key adage is "prevention is always better than cure".

If the FSA is going to step in it has to do so properly and make sure the checks are in place to guarantee fraud is picked up early.

If the whole premise relies on the FSA being tipped off by an industry insider then it will simply create an air of suspicion that will be of no use to anyone.

Simon Cocker is head of business development for Dunfermline Building Society