In an echo of the troubles gripping the US sub-prime lending sector, a Persimmon development in Thamesmead appears to be at the centre of a major mortgage fraud in London. According to this in the Times, four major lenders have lost money in a scam involving a property development company called Atrex, who appear to have either bought off-plan at a discount, created false identities and obtained mortgages at inflated prices, creating an immediate profit, or provided inflated valuations to genuine buyers. It's not entirely clear from the piece. But in either case, a series of defaults has revealed the price inflation, leaving lenders out-of-pocket. On its own, it won't bring down the UK sub-prime sector. As a taste of what's going on elsewhere, it's worrying.

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