RBS investigates alleged overseas mortgage scam

by Gill Montia

Story link: RBS investigates alleged overseas mortgage scam

Royal Bank of Scotland (RBS) has suspended two executives suspected of misdemeanours in its overseas mortgage department.

Both members of staff are alleged to have taken backhanders in return for referring UK borrowers to foreign estate agents, continuing their activities long after RBS was rescued by the Government.

According to The Daily Telegraph, mortgages were arranged for people interested in investing in second homes in popular European locations, such as France and Spain.

The RBS executives then directed the bank’s customers to selected agents who would help them find a property.

The newspaper suggests that the alleged scam could involve hundreds of thousands of pounds with loans being made for properties bought off plan and developers never receiving the full “purchase” price.

RBS says it is carrying out an internal inquiry and will be establishing whether the allegations involve the two suspended employees only, or are more widespread.