Two companies exposed by the Financial Conduct Authority (FCA) for taking advantage of financially distressed home-owners through unfair ‘sale and rent-back’ deals had been trading illegally for some time, The Property Ombudsman (TPO) has confirmed.
The London-based companies and individuals involved are London Property Investments (U.K) Limited (LPI), NPI Holdings Limited (NPI), Daniel Stevens (the sole director and shareholder of both companies) and his father Anthony Kafetzis.
All now face proceedings in the High Court but it has also emerged that the companies involved were thrown out of TPO on 30th March this year for non-payment of fees and were reported to Trading Standards.
The schemes being run by LPI and NPI are said to have affected dozens of home owners many of whom lost hundreds of thousands of pounds despite already being in considerable debt.
Both companies offered to help home owners remain in their properties by providing seemingly miraculous deals that enabled them to clear their debt, keep their home and suspend mortgage payments for up to five years.
In reality the loans were replaced with higher-interest mortgages for greater amounts than their original debt and required restrictive covenants to be registered at the Land Registry, preventing the owners from selling their homes at a later date. LPI organised the new mortgages while NPI often offered to buy the properties and then rent them back.
TPO says its logo has subsequently not been removed from the companies’ websites. The FCA has now secured an interim injunction preventing the companies’ schemes from continuing and has frozen 17 residential properties worth £3.9 million and personal assets worth £867,770.