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What is the £1.3bn MFS mortgage scandal and what is private credit?

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What is the £1.3bn MFS mortgage scandal and what is private credit?
The collapse of Market Financial Solutions (MFS) in early 2026 has sent shockwaves through the private credit market. The UK-based bridging lender entered administration following allegations of a massive £1.3 billion fraud, involving 'double pledging' - where the same property is used as collateral for multiple loans.

A worldwide freezing order has been issued against founder and chief executive Paresh Raja, who reportedly left for Dubai as investigators uncovered a massive shortfall. While MFS owed £1.3 billion to creditors, the underlying assets were valued at just £230 million. Major banks, including Barclays and Santander, face significant exposure. The scandal has been dubbed a 'cockroach even', exposing systemic risks in the private credit sector where rapid growth appears to have outpaced regulatory oversight and internal governance.

Read more on this developing story at the Guardian here
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