Northern Rock investigation takes in more former employees
The Financial Services Authority (FSA) has broadened its investigation into Northern Rock to see whether any other figures in the company were aware that mortgage arrears figures were not reported correctly to the FSA. This comes at a time when the UK banking industry is again under the spotlight with revelations appearing in the public domain regarding various practices before and during the recession.
As we have mentioned on numerous occasions, the collation of mortgage arrears data is vital to the FSA and the UK government, as it effectively allows them to measure the financial strength of each and every financial company in the UK. It also gives a broader picture of the UK property market and allows very changes in interest rates and the introduction of fiscal stimulus programs where required. Whether or not the correct reporting of Northern Rock mortgage arrears would have made a massive difference to how the UK government and regulators reacted to the recession is debatable but it is an issue which needs to be addressed sooner rather than later.
David Baker was last week fined and banned by the FSA in what was a very public rebuke of the mortgage arrears reporting system that the company operated.
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