Mr. Weechasked the Chancellor of the Exchequer what checks are made by the Registry of Friendly Societies to ensure that no conflicts of interests arise in cases where building society directors have business connections with organisations seeking mortgages.
§ Mr. LawsonEvery building society is required to include in its annual return to the Chief Registrar particulars of any advances made (1) to a company or other body corporate in which when the advance was made, or at any later time in the relevant financial year, a director, manager or secretary of the society held (either directly or through a nominee) shares the nominal value of which exceeded two and a half per cent. of the total paid up share capital of the company or other body corporate, or (2) to a company or other body corporate of which, when the advance was made, or at any later time in the relevant financial year, a director or the manager or the secretary of the society was a director, general manager, secretary or other similar officer.
There is also a statutory duty, imposed by section 73 of the Building Societies Act 1962, for a director of a building society who is in any way interested in a contract or proposed contract with the society to declare the nature of his interest to the board of directors of the society. Failure to do so is a criminal offence.