Banks increasingly wary of property fraud

With regard to the first scam in the article, if you pay the deposit to a reputable Conveyancer (or a reputable Estate Agent), then the so-called "seller" will not have access to the funds until transfer in the Deeds Office, by which time the fraud should have been discovered.  The funds will also be insured.  Obviously, the more sophisticated scamster can use false ID's and other documents but the "seller" can't just take the money and run before some level of due diligence is completed.

My advice is that by retaining the services of REPUTABLE Estate Agents and Conveyancers, the risk is reduced to virtually zero.

Gareth Shepperson
Reputable Conveyancer

Banks increasingly wary of property fraud

'Banks need to perform more rigorous checks because various types of fraud have now become increasingly common in property sales,' says Bill Rawson of the Rawson Property Group.

'There have been cases where the seller in fact did not own the home and the true owner did not even know that his house was being sold by the trickster.'

In these situations, says Rawson, the crook, posing as the owner, ensures that the initial confirmatory deposit is paid into his pocket - and then disappears. In some cases far bigger sums - 50% or even 100% of the sales price - have been paid out and are completely lost to such unidentifiable fraudsters.

The bank, for their part acting in good faith, may well pay out the full sum to the so-called seller, only to find that they are left with a home that has to be repossessed and, if sold, is likely to fetch well below the market value - while the true owner is left with a huge legal complication.

In other cases, says Rawson, the true owner and buyer come to an agreement to raise the price of the house above its actual market value, thereby enabling the buyer to get a bigger bond. This, he says, has been especially prevalent when the buyer has wanted a 100% bond which the bank is not prepared to give him. Surprisingly, although the bank will usually send its own valuer to inspect the property, these people can on occasions be persuaded that the higher price is valid.

This becomes possible, says Rawson, because bank valuers often have to assess properties in a wide variety of areas and cannot be expected to be completely up-to-date with values in all of them.

Similar scams, says Rawson, take place every year in the rental market. A home - often a holiday home - will be advertised (perhaps in terminology too vague to pinpoint its exact whereabouts) and then the bogus agent or landlord will pocket the deposit or even the full rental when it is paid in advance of occupation.

'In order to make sure that you are never deceived when purchasing or renting a property,' said Rawson, 'always make sure that you use an agent from a well reputed agency that can be held accountable for their actions and who will make sure the seller is who they say they are.'

Rawson Press Release


Denny Crane

Denny Crane
It's not me ... yet. Denny Crane from the TV series Boston Legal. Click on picture if you're not sure who he is!