Labour’s shadow minister for digital, culture, media and sport has questioned the level of fraud in the peer-to-peer lending sector.
Alex Sobel, Labour MP for Leeds North West has issued a written parliamentary question to the justice secretary Robert Buckland.
The query, due to be answered today (11 January), asks “whether he plans to make an assessment of the potential level of fraud in P2P lending and crowdfunding.”
It is unclear from the question which, if any, P2P lenders he is referring to.
There have been some claims of fraud during administrations of collapsed P2P lenders such as Lendy and FundingSecure.
Lendy co-founder Liam Brooke has been accused of using misappropriated funds through an offshore company to purchase the collapsed P2P lender’s headquarters.
High court documents approving a freezing order against Lendy founders Brooke and Tim Gordon also disputed the rightful ownership of the platform’s former base at Branksmere House in Portsmouth as well as other properties.
The document suggests around £770,000 was channelled from the misappropriated funds to Brooke via a loan to Argo Private Finance Limited, one of the companies involved in an offshore structure to purchase Branksmere House.
There are also questions over the source of funds for three other properties.
Brooke and Gordon have denied these claims in court documents.
Activists have also setup the Lendy Action Group to pursue legal claims over how the platform was run.
Additionally, former FundingSecure director Richard Luxmore has been accused by the collapsed lender’s administrator CG&CO of wrongfully arranging for more than £8m to be channelled to a property developer through the platform.
This issue has been sold to and is now being pursued by litigation funder Asertis, according to The Times, which reports that a settlement was already reached with Luxmore.
There have also been claims of fraud among European P2P lenders such as Envestio and Kuetzal.