LONDON (Reuters) - British regulators have fined a property agent nearly a million pounds for defrauding vulnerable people, the largest-ever fine for a sole trader in the consumer sector.
The Financial Conduct Authority (FCA) also banned Gurpreet Singh Chadda from working in the financial services industry for the way he conducted sale and rent back agreements that netted him 695,277 pounds from seven transactions.
The agreements refer to where a homeowner, often in financial difficulties, sells and then rents the property back from the agent so they can still live there. The FCA's 945,277 pound fine included the whole sum defrauded.
"Chadda's misconduct is the most shocking we have seen from a home finance arranger. He is a disgrace to financial services," FCA director of enforcement, Tracey McDermott, said on Wednesday.
"The unprecedented level of the fine for a sole trader reflects our determination to deprive him of the gains he made as a result of his misconduct."
Following a probe of seven sale and rent back transactions, the FCA found that Chadda had told customers he would be buying their home when in fact the purchasers were other people.
Two homes were valued at significantly less than actual market value, while in two cases the seller received just over a third of the sale price of their home.
Chadda, based in the city of Birmingham, helped one buyer of a property to mislead the mortgage lender by drafting a letter that falsely confirmed the seller would not be staying in the property, the FCA said.
While being probed by the FCA, Chadda also made false and misleading statements, and arranged for people to impersonate his customers in order to hoodwink the watchdog.
Reporting by Rosalba O'Brien and Huw Jones; Editing by Tommy Wilkes and Pravin Char