How to protect your property (and yourself) against fraud

Following the recent outcomes of two high profile Court of Appeal cases involving property fraud, the spotlight has again been firmly focussed on the necessity for homeowners to become savvier regarding the dangers they face from fraudsters posing as property owners. Criminals are happy to exploit every opportunity to defraud an unsuspecting property owner; make sure you do not give them the opportunity!

In these cases the fraudsters stole the identities of the true owners, in Dreamvar, renting the property in question and then posing as the owner. After finding buyers for the properties, the criminals engaged solicitors and proceeded to sell the properties, making off with the proceeds while the true owners were completely unaware of what was happening!

The frauds came to light following completion of the sales but before the properties were registered in the new owners’ names, therefore it was the innocent buyers of the properties who lost out!

Since 2009 Land Registry, in conjunction with police and other government departments, has stopped property frauds worth more than £92m. But there will always be the one that got away. You can do more to reduce your risk of becoming a victim.

So what are the valuable lessons we can learn from these cases?

We, as your solicitors, conduct checks on clients to confirm their identity before we start any work. It is not enough to work out who owns the property and to have ID for that person. We must also be sure that our client IS that person and not someone who has stolen their ID; we do this using a combination of online searches backed up with good old fashioned checks and common sense.

Fraudsters target property ownership where the risks of detection are seen as lower, such as:

  • Empty properties, for example where an owner lives abroad, has more than one property, is elderly and in residential care or has died;
  • Rented properties;
  • Unregistered properties;
  • Mortgage-free properties, as no lender’s permission is needed to sell the property.

HM Land Registry gives these tips to reduce your risks:

  • Make sure your property is registered. The government will not compensate owners who are the victims of property fraud if their properties are unregistered. We can advise you on voluntary registration of your title.
  • Keep your details up to date with Land Registry so that they can contact you if needed. They can store three addresses on the register, including foreign and email addresses.
  • Sign up for their free Property Alert service. This allows you to receive alerts of activity for up to 10 registered properties.
  • Enter a restriction on your property, to require a solicitor or conveyancer to confirm they are satisfied that the person selling or mortgaging the property is the true owner. It sounds silly but it gives an extra line of defence if the conveyancer dealing with the sale has to put their own name to their client’s ID.

If you think that any of the above may apply to you please speak to us. We will be happy to help you make your property more difficult for fraudsters to target.

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