How to protect yourself from property fraud

Fraud is becoming an increasingly significant issue and is now one of the most commonly experienced crimes in the UK. According to the Office for National Statistics’ crime survey, there was an estimated 3.3 million cases of fraud in the year ending June 2018[1]. This high figure captures a broad range of fraud offences, including lower-harm cases. But fraud can have very significant impacts, particularly as the value of the scam increases. Property fraud is a real threat that buyers, sellers and solicitors need to be aware of to help ward-off would-be fraudsters.

Property is a high value asset and an attractive target for scammers. Figures from the HM Land Registry, the official register of property ownership in England and Wales, show that the value of fraudulent property sales has more than tripled since 2013 when it was £7.2 million, hitting £24.9m in the year to April 2017[2]. Action is being taken, though. Telegraph Money reported that the HM Land Registry has stepped in to prevent 279 scams worth a total £133 million[2]. The Law Society has dubbed the issue ‘Friday afternoon fraud’, noting that conveyancing transactions commonly complete on Fridays. With so much at stake, those going through the conveyancing process, or thinking about buying or selling a property, are right to be vigilant.

The most common types of property frauds

Property fraud comes in different forms, but these are three example scams to be wary of:

  • Title transfers – Fraudsters who attempt to sell your property under your name, transferring your property into their own name using false documents.
     
  • Email hacking – When fraudsters intercept emails between the buyer and their solicitor and alter the bank details so the money is sent into their own accounts.
     
  • Investment scams – These involve getting you to hand over money on the promise of high returns. These may either be buy-to-let schemes on properties that are actually in poor condition or frequently vacant, or being tricked into a land banking scheme where the plot of land is non-existent or doesn’t hold the value it’s sold for.

Who is most at risk?

Anyone who owns a property or is in the process of buying property is at risk of property fraud, but some situations carry a higher risk. For example, fraudsters are particularly attracted to homes that are frequently vacant because they can use your property address as a base and begin the process of identity theft. If you regularly travel or you’re letting and your property has been vacant for a while, this is something to be mindful of. Additionally, anyone who has an unregistered property or hasn’t had a mortgage on it since 1990 is more vulnerable to fraud.

Steps you can take to prevent property fraud

The HM Land Registry offers a free Property Alert service, which alerts owners through email when there is certain activity related to their properties, such as an application to change the ownership details. Owners can then decide whether they think the activity is suspicious and can notify the HM Land Registry, their lender and the police. If (as is common) your property is registered, all you have to do is to is create an account with the Land Registry by following this link. You can monitor up to 10 properties and you may want to monitor the property of an elderly family member or friend.

If you are unsure whether your property is registered, you can check the register through HM Land Registry. To ensure the effectiveness of the service, property owners must keep their contact details up-to-date so the Land Registry can reach them easily.

Also, if you’re buying, don’t be shy about confirming and reconfirming details with your solicitor throughout the process. Solicitors and banks have strict obligations to check the identity of the person they are acting for and must question any discrepancies in documents if they do not believe them to be genuine.

Lastly, be cautious if your solicitor emails you to notify you of any change in bank account details. Email is not a secure method of communication and should not be used to communicate bank details. Always call your solicitor to confirm details before making any transactions and validate whether someone authorised in their firm actually did send the email.

What to do if you think you are a victim of property fraud

If you think you may have been a victim of property fraud, you need to notify the Land Registry as quickly as possible by calling their Property Fraud Line on 0300 006 7030.

It would also be highly beneficial to seek legal advice. Solicitors are trained to look for the potential warning signs of land fraud. One of the benefits of choosing a qualified legal professional is the added peace of mind that their valuable property interests are protected.

To protect yourself against property fraud, engage an experienced property solicitor. For free and no-obligation quotes for your conveyancing needs, call 08082747557

 

[1] Office for National Statistics, ‘Crime in England and Wales: year ending June 2018’ https://www.ons.gov.uk/peoplepopulationandcommunity/crimeandjustice/bulletins/crimeinenglandandwales/yearendingjune2018/pdf

[2] Financial Times, ‘Help! My house has been hijacked’ https://www.ft.com/content/b195fb02-2fde-11e7-9555-23ef563ecf9a

[3] The Telegraph, ‘Property fraud: how your house could become the perfect tool for scammers’ https://www.telegraph.co.uk/money/consumer-affairs/blocked-property-fraud-hits-130m-house-could-become-perfect/


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