What is property fraud?
In its most common manifestation, this refers to fraudsters impersonating the identity of property owners, usually in order to mortgage or sell a property, or transfer assets into their own name. They may also pretend to be buyers and use deceitful ways to con genuine sellers.
Examples of property fraud:
This involves forging identification documents to pretend to be a property owner and sell the property, or requesting a change to the Land Registry to transfer the property into their name. Knowledge of this often hits the actual owner when the damage is already done.
Fraudsters intercept emails between buyer and solicitor or/and conveyancer, change banking details so that money is directed into their account, rather than the solicitor/conveyancer.
Marketing a plot of land (which doesn’t exist or cannot be granted planning permission) as holding a high investment potential. This is known as ‘land banking’.
Fraudsters claim to be buyers and overpay sellers with a deposit with a stolen or fake credit card. They then ask sellers to pay back the overpaid amount, before sellers finding out that the first transaction made with a fraudulent card never existed.
Quick sale scams
Buyers make an offer to buy a property but reduce the offer price at the last minute, leaving the sellers with little choices.
Holiday home scams
Some holiday homes are advertised and sold as permanent residences – but can never be used as such.
Why is property fraud so common?
The primary reason is that fraudsters can now purchase details of the owners and their properties on HM Land Registry website inexpensively.
On this gov.uk site, the government have listed a number of factors that put you at a greater risk of property fraud if:
- Your identity has been stolen
- You rent out your property to tenants
- You live overseas
- The property is empty
- The property is not mortgaged
Our research has also found other factors. For example, if:
- Your property holds a high value
- Your property is undergoing redevelopment
- You are representing the property on behalf of someone else, e.g. a relative who has recently deceased
- Your property isn’t registered with HM Land Registry
- You are an elderly person
- The property address is the only contact address listed for the owner (making you vulnerable to identity theft)
The time to protect your property is now, and here is what you can do to keep yourself safe.
How to protect yourself from property fraud
1. Sign up for alerts
On the HM Land Registry site, you can sign up for property alerts and be notified if someone applies to change the register of your property, like if someone uses your property to apply for a mortgage. Do note that receiving alerts does not mean the authority will block any changes to the register automatically – it means that you are aware and can take action.
2. Put a restriction on your title
You can put a restriction that no one can register a sale or mortgage on your property unless a conveyancer or solicitor certifies that you made the application. There is no fee if you don’t live at the property or if you are a company owning property, but if you live at the property, the fee is £40.
3. Be contactable
Ensure your contact details are correctly registered with HM Land Registry. That way, you’ll be contactable in case of emergency.
4. Screen your solicitor or/and conveyancer
Check the legitimacy of your conveyancer by looking for them in the Council for Licensed Conveyancers or The Law Society. Keep your guard up, especially if the correspondences do not seem professional or if they are trying to complete the transaction as quickly as possible.
5. Be careful with bank details
Conveyancing firms usually state their bank details via letter. If you receive an email stating alternative details, or are generally unsure, phone them. Also, avoid stating your bank details on an email.
Take necessary action
In November 2018, HM Land Registry stated that it had successfully prevented 279 fraudulent applications with a combined property value of £133.4 million from being carried out since 2009.
But the primary responsibility falls to you the property owner to take preventative actions against fraud. And if you are a victim of property fraud, it is essential that you take actions quickly. Among the things you need are:
- Write down all the events and parties involved leading to the case
- Contact HM Land Registry property fraud line on 0300 006 7030 (Monday to Friday, 8.30am to 5pm) or email firstname.lastname@example.org.
- File a police report
- Contact your banks if your bank accounts are affected
- Contact our investigative team on +44 (0)20 8108 9317 if you need help to trace the fraudsters
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