With the help of false documents the two men approached state mortgage lender SBAB and secured loans for 2.7 million kronor ($350,049) secured on the central Stockholm apartment belonging to the 74-year-old mother of Filippa Reinfeldt, wife of the Swedish prime minister, according to local newspaper Mitt i Vasastan.
A neighbour in the tenant owner housing association was also hit by the same swindle and the thieves were able to a acquire a further loan of 2.3 million kronor from SBAB against falsified sales documents.
The men then instructed SBAB to transfer the money into the “sellers” bank account in Swedbank. The men then arranged for the money to transferred to an exchange office.
Staff at the Palm Exchange at Hötorget metro station in central Stockholm sounded the alarm when the men called to give notice of their intention to withdraw the funds.
Police investigations were able to unearth the fraud and reveal the source of the money. A sting was then set up at the exchange office last Monday to lie in wait for the men.
Plain clothes officers were able to arrest the men red handed and in possession of 1.8 million in 500 kronor notes and the equivalent of 900,000 kronor in euros.
Previous housing frauds have centered around soliciting payments for deposits and down payments and the scale of the swindle surprised prosecutor Thomas Forsberg at the financial crimes unit (Ekobrottsmyndigheten).
“It is extremely cheeky. The set up (of the fraud) is a new one for me,” he said to the newspaper.
SBAB is one of the larger operators in the Swedish mortgage loans sector with outstanding credits amounting to 190 billion kronor.
The state-owned lender plans to look over its routines in order to tighten security.