ASIC bans broker over multi-million dollar loan fraud

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A Sydney based mortgage broker has been banned from providing financial services and from engaging in credit activities for four years following an investigation by the Australian Securities & Investment Commission (ASIC) into multi-million dollar loan fraud. 

ASIC’s investigation found that between 2008-2011 Raghwa Nand Prasad contravened credit legislation and financial services laws in respect to seven loan applications that were prepared by his then wife, Shashi Kanta Prasad.

In September 2014, Ms Prasad was convicted of fraud for creating false loan documents in an attempt to secure home loans totalling more than $3.6 million and in May 2015 was banned for 10 years from engaging in credit activities and from providing financial services.

ASIC found that Mr Prasad, due to his role as a tax agent for the applicants, knew the loan documents to be false and assisted Ms Prasad in the preparation and submission of them.

Among a number of breaches ASIC found Mr Prasad had signed off on applications containing false documents without querying whether the application accurately represented his client’s financial situation and directed or allowed Ms Prasad to send the application containing the false documents to the lender while knowing the application documents were false after having acted as a tax agent for the loan applicants.

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