9 May 2005
Fears have arisen about widespread personal loan malpractice following a leaked internal audit revealing how Lloyds TSB issued thousands of loans to customers it knew would struggle to meet repayments.
The scandal could spell serious trouble for the UK's loan market, particularly if reports suggesting that as many as one in six loan deals are completed improperly, are confirmed to be true.
According to various reports, the audit shows excessive pressure was placed on the bank's financial advisors and lenders to push loans through often without making proper checks and frequently without completing all the required paperwork.
Antony Elliot of the independent Centre for Financial Innovation said: "Once, bankers could be compared to doctors in the way they attempted to provide finance to a customer in his or her best interest.
"Now, they are more like bartenders, knowingly serving alcohol to people who are already drunk."
The audit was leaked to the BBC, who will be screening a documentary tonight exposing the bank's lending malpractice.
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