The FCA has obtained a judgment against London Property Investments (LPI), NPI Holdings, their director Daniel Stevens and his father, Tony Stevens, for arranging mortgages without the regulator’s authorisation.

According to the FCA investigation, the pair and the two companies are also believed to have exploited vulnerable customers who were in financial difficulty.

The judgment found that the defendants arranged high-interest, unaffordable bridging loans for consumers about to be evicted from their homes, taking huge fees. In some cases, the defendants bought homes for less than their value from owners who were facing repossession and then rented the properties back to these consumers.

However, the defendants were not authorised to arrange mortgage contracts or sale and rent back agreements. The judge described these breaches as “exploitative of vulnerable individual consumers” and found that they were undertaken “to obtain significant personal gain”.

LPI will now be required to remove around 22 restrictions registered against individuals’ properties. These restrictions were used by the defendants to force the individuals to pay exorbitant fees to LPI. If these were not paid, then the individual could not sell or remortgage their property, and in some cases this trapped individuals into high interest bridging loans.

“These companies and individuals were not just providing financial services without proper authorisation, they were doing it to take advantage of people who were struggling and in vulnerable circumstances,” commented FCA executive director of enforcement and market oversight, Mark Steward.

“Their actions cost consumers large amounts of money in fees, inflated loan interest and lost equity in their homes. This judgment will help bring financial relief to these consumers.”

In July 2020, the FCA obtained an interim injunction and a freezing order to stop these activities and freeze residential properties as well as other assets owned by Tony and Daniel Stevens and the two companies.

A later trial will consider compensation for the affected individuals, the FCA also confirmed. This trial will hear evidence in respect of up to 88 further potentially affected individuals who were not part of the regulator’s first claim.

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