Property fraud

Your property is probably the most valuable asset you own so it is important to protect it from fraud. 

Most homeowners do not realise that title deeds are no longer needed to sell a property. In 2003 following the Land Registration Act 2002, the land registry “dematerialised” deeds, which meant that it was no longer necessary to produce the land or charge certificate for the sale of a property.  Instead, now all you need to do is to show ID to your solicitor. This change has unfortunately led to a massive increase in fraud. Fraudsters can pretend to be a property owner and then sell the property and pocket the proceeds. Solicitors now have to be very careful when acting on the sale of a property. We have to ensure that the person claiming to be the owner of a property is genuine. We have to check his or her identity and if they do not live at the property in question then we have to carry out further checks. 

Homeowners are more at risk of such fraud if their property is rented out, empty, mortgage free or not yet registered at the land registry. There are ways to reduce the risk of being a victim of property fraud. Your solicitor can help you with these measures. You can sign up to the land registry’s free property alert service. The land registry will then notify you of certain applications affecting the property you are monitoring such as for a new mortgage or change of ownership. If you receive an alert about activity that seems suspicious you should take immediate action by contacting the property fraud line at the land registry or by contacting your solicitor. You can monitor up to ten registered properties in England and Wales. You don’t have to own the property, so you could monitor the property of an elderly relative for example.  Alerts are normally sent by email but these can also be sent by post. 

If your title deeds are not registered at the land registry, you should ask your solicitor to make a voluntary application for first registration. Those most likely to be unregistered are properties which have not changed hands or been mortgaged since 1990. If your ownership is registered and you are the victim of fraud or you suffer financial loss, you may be entitled to compensation from the land registry.

Once you are registered at the land registry, you should ensure that you keep your contact details up to date. You can give the land registry up to three addresses and these can include an email address and an address abroad.

You can also apply to register a “restriction” against your title at the land registry. This can stop activity such as a sale or mortgage, as your solicitor will have to check and certify that the activity was made by you. 

For peace of mind, we suggest you speak to your solicitor to ensure that you have taken all possible measures to protect your property from fraud.

Another fraud threat for property transactions is the impersonation of solicitors and conveyancing practices.  A solicitor acting for you on a purchase of a property will need to ensure that the solicitor he or she is dealing with is genuine. This is important, as otherwise we may inadvertently send the purchase price for a property (which could be a very large sum of money) to a fraudster who disappears with your money - and you as the purchaser will never obtain ownership of the property.  With this in mind, we have to check that the seller’s solicitor is part of a professional body at a recognised office. There are various checks which we carry out and these include checking the contact details for the solicitor, checking their website, and checking with their professional body and also checking their bank details. There have been instances recently when fraudsters have set up bogus second offices of established firms. All solicitors have to be very vigilant nowadays to look out for possible fraudsters and to ensure that we are dealing with genuine solicitors.

Yet another area for concern relates to fraudsters “hacking” into clients’ computers during the course of a conveyancing transaction and sending bogus information to them purporting to be from their solicitor, asking for payment of the purchase price to be sent to the fraudster’s bank account.  These emails usually appear suspicious but unfortunately some people have been duped and lost large sums of money.  For this reason, your solicitor will not provide their client account details to you by email.  These will be sent to you by post or given to you over the telephone only. 

Advances in technology have undoubtedly brought many advantages to us and technology has speeded up the conveyancing process, but we all need to be vigilant for fraudsters. 

To find out more, call us on: 01603 625231