Property fraud is on the rise, how are you protecting your assets?
07 July 2017
Fraud involves a person dishonestly and deliberately deceiving a victim for personal gain of property or money. Anyone can be a victim of fraud and the increasingly sophisticated methods that fraudsters are using to target property owners should not be ignored.
The types of property fraud and challenges which the authorities are up against include:
- Fraudsters who attempt to sell a property without the owner knowing by using fraudulent identification documents.
- Fraudsters tricking buyers into transferring money into their bank accounts instead of their solicitor’s/conveyancer’s by intercepting and changing the solicitor’s/conveyancer’s bank account details to their own.
- Quick-sale and too-good-to-be-true property investment scams.
Who are fraudsters targeting?
As the majority of property is now registered, information about it is open to the public and anyone can do a search at the HM Land Registry to establish who owns a property, whether it is mortgaged or not and even what price the property was originally purchased for.
Certain classes of property owners and properties are more vulnerable than others. These include properties which are:
- empty (for example, holiday homes and properties held by personal representatives where the registered proprietor has died);
- rented or leased and managed by an agent or other third party;
- not mortgaged (especially high value properties);
- not registered at HM Land Registry
or where the owner lives overseas or has already been the victim of identity fraud.
While residential properties are more typically the subject of fraudulent activities, other types of property are not immune.
What can you do to reduce the risk?
The following practical steps can be taken to help reduce the risk of property fraud:
- Take care when receiving solicitor’s/conveyancer’s bank account details. If you receive the bank details by email or post, it is advisable to phone the company to make sure they are correct. Many firms provide clients with their bank details at the outset (by post) and stress that those details will not change. Therefore, if you receive bank details which differ to the original ones provided you should call the firm to verify the position.
- Take care when providing bank account details to your solicitor/conveyancer. Preferably, try not to send your bank account details by email (to anyone). Try and either provide them over the phone or in person. If bank account details are provided by email, do not send them in a format (e.g. word) which a fraudster can intercept and alter. Sending as a pdf is a safer method.
- Choose your solicitor/conveyancer carefully. Make sure the firm acting for you is genuine by checking with the lists compiled by the Law Society or the Council for Licensed Conveyancers.
- Pay attention. Check all correspondence and documentation you receive carefully to see if there are any signs that the sender is not who they purport to be (for example, is the email address exactly the same as before; if you get a hard copy letter, does the letter heading or print seem unusual or otherwise not what you might expect from a professional law firm; is the tone, language or spelling of the correspondence unusual or different, or again not as you would expect?). Vigilance is key.
- Sign up for the Land Registry Property Alert Service. This is a free service where HM Land Registry will alert you by email when there is certain activity on the property which you have selected. The alert enables you to deduce any suspicious activity which has not been authorised by the registered owner (for example if an application is made to register a mortgage or a transfer of title ownership). This service will not by itself block the transaction from being registered, but it will put you on alert so that you can seek further advice, or contact HM Land Registry, if you are concerned the application is not bona fide. For more details, see this page on the Land Registry website - https://propertyalert.landregistry.gov.uk/
- Ensure your contact details at HM Land Registry are up to date. This is vitally important as not only is it evidence of your ownership of the property itself, it helps both HM Land Registry and any solicitor/ conveyancer to verify the owners identity and to establish that the person purporting to be the registered owner of the property is, in fact the registered owner and not a fraudster.
- Register unregistered property. It is strongly advisable for a property owner whose property is unregistered to apply for voluntary registration. This ensures that the property is recorded on HM Land Registry’s records with the correct registered proprietor’s details including their contact details. This makes it more difficult for a fraudster to impersonate the property owner.
- Suspicious behaviour. If you are being pressured to proceed very quickly, establish if there is any genuine reason for this . Fraudsters often use this tactic to try and influence decisions and to make sure that corners are cut. Very rapid completion in return for a bargain price can be one approach. Also, mail solicitations claiming great returns, no matter how good they look, should be treated with great caution. If a deal seems too good to be true, then it probably is.
- Research. Never make property investments without thorough research and appropriate professional advice.
Whilst these measures are not exhaustive and cannot provide full protection, they can help fight against property fraud and reduce the risk of you becoming the next victim.
If, however, you are one of the unlucky victims of property fraud or you think you are being targeted, you should contact HM Land Registry property fraud line on 0300 006 7030 (firstname.lastname@example.org). You can also get advice from Citizens Advice Bureau or an independent legal adviser as well as reporting it to Action Fraud (http://www.actionfraud.police.uk/).