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Consumer Protection Council probes Resort Savings over N128m mortgage frauds



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The Consumer Protection Council (CPC) is launching investigation into the operations of Resort Savings and Loans (RSL) Plc, a Lagos-headquartered mortgage bank, over several allegations of mortgage frauds estimated at over N128 million.

CPC in a report obtained by Ripples Nigeria stated that several customers of the mortgage banks had petitioned the consumer rights’ agency over alleged diversion of their mortgage funds by RSL.

CPC has already forwarded formal complaints against RSL to the Central Bank of Nigeria (CBN) and Federal Mortgage Bank of Nigeria (FMBN), the two regulators for the mortgage industry.

Director General, Consumer Protection Council (CPC), Mrs. Dupe Atoki, confirmed that the Council was determined to investigate the operations of the company as well as engage in other legal steps in line with its enabling law with a view to protecting the consumers of the services of the primary mortgage company.

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CPC stated that the launch of formal investigation was sequel to the failure of RSL to respond to formal query from the consumer rights agency noting that CPC had already communicated the details of the complaints from the aggrieved depositors and mortgage contributors to the company for full response but it failed to respond.

The failure of the company to respond appropriately has placed the option of the prosecution of the firm’s principal officers before CPC.

According to the Council, some of the allegations of the consumers against the company included its failure to pay back deposits made by consumers, even after the agreed tenor was over and repeated demands made by them, as well as its alleged diversion of loans disbursed to mortgage beneficiaries by FMBN.

CPC also disclosed that consumers accused RSL of providing them with incorrect information about their applications for National Housing Fund loans, such as giving non-existent batch numbers, with a view to deceiving them into believing that their applications were under consideration.

The Council stated that one of the complaints against the mortgage company was on behalf of a group of nine beneficiaries of FMBN Batch 54 loans, which alleged that RSL in 2014 received N149.3 million on behalf of 14 beneficiaries, including the nine and that the company failed to disburse the loans to the developers of the said beneficiaries.

CPC said the nine complainants further alleged that five of the 14 in the said batch 54, who are staff of Independent Corrupt Practices Commission (ICPC) brought in the Commission to intervene on their behalf on the issue and thereby forced the mortgage company to disburse N47.25 million due to the five, leaving N102.1million undisbursed to the developers of the remaining nine.

The consumer protection agency stated that the group of nine complainants alleged that the action of the primary mortgage company not to disburse their loans led to the revocation of their letters of allocation by their developers.

The Council also disclosed that other complaints border on default in paying back deposits to depositors and failure to refund equity contributions of disappointed mortgage applicants, making the total worth of the claims against the company on the alleged diversion mortgagors’ funds and default in refund of consumers’ deposits to amount to N128,323,603.64.



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