OFT moves to revoke bridging lender's licence

OFT moves to revoke bridging lender's licence


A high profile bridging lender with over 20 years’ experience is set to have its licence revoked, according to an announcement made by the Office of Fair Trading (OFT).

The OFT update, published this month, said that enforcement action has been taken and the decision has been made “…to revoke the licences of Glasgow mortgage lender, Bridging Loans Limited (BLL) and four associated companies.”

Specialising in first and second charge short-term loans, BLL and associated companies will be unable to conduct any regulated business if the planned revocation is to go ahead.

Because the lender has appealed against the decision it will not take effect unless the appeal is determined in the OFT's favour.

Commenting on the announcement, David Levitus, Director at Bridging Loans Limited, exclusively told B&C: “It is widely known that the FSA have been investigating the bridging industry for the past two years. We were fined by the FSA in 2010 for inadequacies in our regulated lending procedures but we have since implemented new systems and policies across the board. We were informed at that time that it was automatic that the OFT would subsequently withdraw our consumer credit licences and that we would have to re-apply for our licences.

“We can continue to conduct commercial lending (e.g. residential buy-to-lets, commercial property bridging, development finance) and the restrictions only apply to regulated lending, which was only ever a small percentage of our business.

“Although an OFT licence is not required for commercial lending, we are appealing the OFT decision because we want to leave the door open to do FSA regulated bridging in the future.  Bridging Loans Ltd has been under new management since 2010 and with our new internal administrative procedures, we are confident of a bright future.”

This news comes after the FSA fined BLL and its director, Joseph Cummings, in 2010 for serious failures relating to lending practices. The lender believed it had been ‘targeted’ by the regulator; however, such sanctions go to show an increasing government crackdown on companies in the ever-crowded bridging market. And with wider industry regulation looming in the year ahead, this case is unlikely to be the last of its kind. 

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