Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
Articles |The FORUM |Law Library |Videos | Fraudsters & Co. |File Complaints |How they STEAL |Search MSFraud |Contact Us

August 21, 2007 2:10 p.m.
LONDON -- The Bank of England's standing facility, which can be used to square accounts between banks, was used Monday to cover a shortfall in Barclays PLC's BOE account, according to people familiar with the situation.

The use of the facility was described by people familiar with the situation as an operational issue and not related to liquidity concerns in the credit markets.

To square Barclays's accounts at the BOE, the BOE loaned Barclays 314 million British pounds ($622 million) at a rate of 6.75%.

Barclays was short the amount in its BOE account Monday. Such shortfalls are not uncommon. HSBC Holdings PLC was in the process of trying to provide the money to Barclays -- likely through an interbank loan -- but that transaction didn't meet a 4:20 p.m. London time deadline on Monday, people familiar with the matter said. It isn't clear if a simple mistake was to blame.

Banks can't have BOE accounts which are short overnight. A loan from another bank or the BOE standing facility can be used to cover the gap.

The use of the standing facility typically goes unnoticed by the broader markets. It was last used July 17 when an unnamed financial firm borrowed 109 million pounds from the BOE. BOE records show that as of Aug. 1, the standing facility had been used 15 times since it was introduced in May 2006. Some 57 financial institutions in the U.K., U.S., Europe and Asia have access to the facility.

Write to Carrick Mollenkamp at and Natasha Brereton at
Quote 0 0
Write a reply...