When lenders lose original loan documentation, and their response is to fabricate documents that have nothing to do with reality, it is not a business plan, it is criminal fraud:

It is hard to credit, but lenders routinely mislay the card and loan agreements their customers originally sign. But even more astonishingly, if there has been a dispute later on, the lenders have used computer software to ‘ recreate’ the original documents, sometimes with less than accurate results.

Being able to recreate agreements in this way helps banks pursue borrowers over debts, but there is growing evidence that when lenders ‘recreate’ contracts they often do not stick to the original terms.

The result is that borrowers who are often already in financial trouble are left in worse difficulties.

Document ‘recreation’ is in the spotlight after a court case last month involving a number of borrowers with credit cards issued by HBOS, Barclaycard, MBNA and HSBC. Part of the case, heard in the High Court in Manchester, was to assess the circumstances in which banks could ‘ reconstitute’ lost agreements.

Judge David Waksman concluded that in future, lenders would have to explain why they did not have the original agreements. He said they would have to prove that the recreated document was a true copy of the original contract.

This is in the UK, not the US, that this is happening in right now.

There should be arrests and criminal charges, but all they are getting is a slap on the wrist from the Office of Fair Trading guidelines.

The UK is like us in this way, and it is a pity.