The process of buying a home has become a target for fraudsters as it involves large sums of money. The Solicitors Regulation Authority (SRA) estimates that, on average, victims of conveyancing fraud lose £101,000.
What is Property Fraud?
During these unprecedented times, the number of fraudulent activities has increased, mostly due to the changes that have taken place, such as working from home. Fraudsters are using property as a way to gain extortionate amounts of money. They can do this by pretending to be you whilst selling or buying a property, or use fraudulent documents to acquire ownership of a property. As well as pretending to be a buyer or a seller, there are high chances of them impersonating a landlord, rental agent, lender or even a conveyancer.
The source of this roots from identification. The pandemic has made it very challenging for firms to carry out verification of clients’ identification and the source of funds check. Now more than ever, clients communicate with their solicitors through email and phone, presenting fraudsters with a bigger opportunity. With frequent national lockdowns, the urge to complete on a purchase / sale is increasingly high, which often leads to missing the red flags that can cause fraud. To aid the firms’ battle, SRA has put an electronic verification process in place.
There are various types of property frauds, and they can affect both buyers and sellers. The most distinct and concerning is vendor fraud, which targets the vulnerable and the elderly; however, this does not conclude the list.
You’re more at risk if your property:
- is rented out
- is empty
- is mortgage-free
- isn’t registered with HM Land Registry.
Protecting yourself from Fraudsters
Buyers
- Never give in to demanding phone calls, emails or letters which cause you to make quick decisions, especially when they relate to your personal details.
- Without verifying bank details with your conveyancer, do not transfer any money over to a bank account.
- Be cautious in engaging yourself with a property which you have not seen in-person or especially where there is a constant change or delay
- If you have any concerns, always confirm with your conveyancer. Never hesitate to ask any questions about the property you are buying, as sellers will have no problem in answering.
Sellers
- Make sure to use a trusted letting agent to avoid any property scam
- Register to receive a “Property Alert” from the Land Registry that will notify you of any applications made in relation to your property.
- Apply for a restriction to be put on your title, which will stop HM Land Registry from registering a sale or mortgage on your property without a conveyancer confirming they have verified your identity.
We are on constant lookout for new scams and frauds, and we ensure that all our members of staff are informed of these new and conventional fraudulent methods. Our staff make sure that they are constantly reviewing for fraud throughout the transaction.
However, if you are concerned that you may have been targeted for the same, immediately contact the Land Registry’s property fraud line on 0300 006 7003.