TSB Conveyancing Panel Information

In operating open conveyancing panels, lenders such as TSB face a number of fraud and negligence risks. While there is no authoritative source of data on lender exposure to solicitor–led mortgage fraud, anecdotal evidence from lenders indicates exposure on individual cases are often in the millions of pounds. The National Fraud Authority estimates that £1bn per year is lost in mortgage -related frauds in total, which is seen as a conservative estimate.

These risks are exacerbated by the lack of a comprehensive set of data on all conveyancing firms (which, for the avoidance of doubt, would include solicitors and conveyancers across the UK) which is in a readily accessible format. Currently, lenders vet the suitability of their panel firms against a variety of disparate, incomplete and potentially inaccurate sets of information. One top 5 lender pointed out to us that it is almost impossible to track individual fraudsters who move from firm to firm, especially where they are no longer registered or no longer hold a valid practicing certificate.

TSB and other lenders are in varying stages of reviewing their approach to vetting firms on their conveyancing panels, to ensure their ongoing exposure to unsuitable firms is reduced. There is also regulatory impetus on lenders to ensure that they have satisfactory oversight of their third party panels, including a due-diligence process.

We can't comment specifically on TSB. Many major lenders are now introducing ‘file auditing’ as standard practice in relation to completed matters. This raises questions of confidentiality in relation to the buyer client and the purpose to which the results of such audits will be put. The starting point is to remember that the file does not belong to your firm, it belongs to the ‘client’. But, of course, we will normally have two clients – the buyer and the lender - and you will owe a duty of confidentiality to each. So basically, you have to separate the file and just send the lender the parts solely relating to themselves. But, of course, as this will basically be correspondence with the lender, mortgage instructions etc.

Check with your COLP but a firm should not send the complete conveyancing file without the buyer client’s express consent – and if she is in arrears with the lender he is hardly likely to agree. However, if the lender can establish a prima facie case of fraud, then you may be under an obligation to disclose the whole file.

The emerging convention is that lenders are including an authority to disclose in loan application forms to counter this problem. Mortgage Express v Sawali, [2010] EWHC 3054 (Ch) indicates that such provisions are valid. Please click here for more information about that case.

One might ordinarily expect TSB via their Part 2 requirements to address this but the Handbook is silent on time frames. You need to look at the Terms of TSB’s Conveyancing Panel Appointment that you are bound by. For a number of banks these Terms have a clause such as: ‘To keep us informed of the reasons for any delay in your being able to send the title deeds and documents we require to us within 3 months of completion or evidence of proof of registration within that period. (We will send reminders if the deeds have not been received but will not acknowledge receipt of deeds’ It is imperative to keep TSB updated. Law firms can often compound their problems by not communicating with the lender when there is a delay or problem.

In order to be on the TSB conveyancing panel solicitors have to complete an application form and agree Terms and Conditions. A sample of 5 conditions that we see amongst many lenders Terms (but not necessarily TSB) are as follows:

• You have the consent of all borrowers to apply for the deeds, before making any request for deeds. We will accept your request for deeds on the understanding that you have obtained such consent. If this is not the case then you should advise our Deeds Services Department in writing when you make your request
• To notify us in writing of any change in your details as held on our records for example, change of address, telephone number, document exchange number email address. Notification must be given to us at least 10 days before the change will be effective.
• If you are a sole practitioner, to arrange for appropriate locum cover from our panel where necessary. Your locum must be a member of the Conveyancing panel.
• Without prejudice to your obligation to comply in full with the Safeguards provisions in the CML Lenders’ Handbook, to report to us as soon as possible any suspicion that you have about the genuineness of any transaction in any respect.
• To forward the title deeds and documents to another solicitor/conveyancer within 24 hours of an instruction from us requiring you to do so. On forwarding the deeds as instructed you will confirm to us that you have done so. Upon receipt of your confirmation, we will release you from all undertakings relating to your holding the title deeds.

In the circumstances please clarify on the application what steps you have taken to find out the reasons behind cancellation of your TSB panel membership. In particular please provide details if you have received communications from the lender. E.G. before cessation of your panel membership did you receive any letters or calls from the lender informing you as to why they reached this decision?

You should get in touch with TSB to obtain standard documents. The The Council of Mortgage Lenders Handbook incorporates a specific inquiry for lenders to set out who to contact to obtain standard documents. TSB in their Part 2’s state: You will need to quote your TSB solicitors panel number.