Lending Fraud – Who should pay?
By Sherry McCourt, CFE
www.sherrymccourt.com
It is 50 years ago and you and your husband decide to build your dream cottage. You have a typical mortgage and as the years go by you manage to pay that mortgage off. You now own your own cottage free and clear.
Fast forward- you are now 73 years old and as you sip your morning coffee you find out that you are in default of your mortgage on this cottage property. The lending institution is demanding payment from you.
You contact the lending company and explain that there must be some mistake and that you do not have a mortgage on your cottage.
Then…
You find out that a female with a poor credit rating and a documented annual income of $30,000.00 was able to take out a $320,000.00 mortgage on your cottage. To add insult to injury a man impersonating your late husband (who passed away just three months prior) signed over your home to this female for $1.00.
This is the story of a woman by the name of Glady Oehlerking of Hamilton.
Her cottage – a tiny two-bedroom wooden cottage in Richmond B.C.
The female – Ms. Sarah Mullen, a hairdresser and secretary and the male – an unidentified accomplice.
The other people involved in the case were Mortgage Lenders, 3 Lawyers, a Notary and British Columbia’s Land Title and Survey Authority.
According to an agreed statement of facts submitted to the court, Ms. Mullen and a man, using the social insurance number and drivers licenses identifying him as Roy Oehlerking met with 3 lawyers and made contact with the lending institution to arrange and collect the mortgage of $273,000.00 (a deduction of 15 percent of the mortgage in fees and expenses was with held) all in under 15 days.
Not one of the three lawyers verified the identity to of the man but if they had – they would have realized that the Social Insurance Number and the Drivers License was invalid because Mr. Oehlerking had passed away three months earlier.
The courts, after three years still have not decided who should be responsible for repaying more than $330,000 in principal, interest and penalties.
The lower court of B.C. ruled that Mrs. Oehlerking is responsible for the monies because of the way the legal system is structure. Then the court of appeals for B.C. sided with Mrs. Oehlerking and decided that the mortgage lender should swallow the loss. There was a backlash from the bankers and lawyers who believe that they have been victimized as well. This case could end up in the Supreme Court of Canada’s docket.
So I ask you – who should be responsible?
1) The legal owner of the property?
2) The bankers and lending institutions?
3) The lawyers?
To read more about this case and the laws mentioned please review Jacquie McNish Globe and Mail article dated Wednesday April 15th 2009 titled “When your house is not your home”
