High Court Removes Land Registry Charges By Money Lender

The Financial Conduct Authority (FCA) as secured a High Court Order to remove hundreds of 1^st and 2^nd charges on property and land registered with the Land Registry by an illegal money lender.

What is a Legal Charge?

For example, when you take out a mortgage to buy a property, the lender’s solicitor (usually your solicitor also acting for the lender) will register a charge on the property at the Land Registry.  This means that if you ever sell the property, the mortgage lender will usually have a first charge and may be a secondary lender has a second charge, if you have taken out additional finance secured against the property and will have their debts paid off before you receive your funds.  A first charge means the first lender's charge is the first in order of priority to be repaid etc.

An illegal money lender, a Mr Gopee and his former companies had been lender money illegally after they failed to secure a consumer credit licence via the Office of Fair Trading, who use to regulated consumer credit licences, but now regulated by the FCA.

Mr Gopee (and his businesses) failed to secure a consumer credit licence but continued to illegally lend money to vulnerable people at high interest rates.  It is estimated that he issued in the order of £1m of illegal loans and got paid back around £2m.  At the time, as with any legally authorised lender, charges were registered at the Land Registry over people’s property and land.

Given the Mr Gopee was operating outside the Consumer Credit Act 1974, he was later jailed for content of court and the FCA has also issued a restraint order under the Proceeds of Crime Act and a confiscation order to recover over £5m.

Comment

This High Court Action is, we hope, the final act in people being able to move on with their lives and sell their properties without being restricted by a charge on their property other then legal ones.