Property fraud is a serious crime and, unfortunately for a growing number of home owners, it is on the rise. With just a few preventative measures, however, property owners can reduce the risk of becoming a target for property fraudsters.
A case of stolen identity
A recent high-profile case highlights some of the risks posed by property fraud.
The facts of the case were that co-fraudster Diane Moorcroft was urged by her daughter, Laylah De Cruz, to change her name by deed poll to that of the elderly property owner Margaret Gwenllian Richards. This enabled her to set up a passport under this name as well as a Dubai residency – the destination where she was alleging to move to upon the sale. A bridging loan worth £1.2 million was agreed with Finance and Credit Corporation, which sent the funds across to an account in Dubai.
Although Land Registry had acknowledged the deal as potential fraud, the money had already been transferred before investigators had an opportunity to intervene.
Previously empty, the house had been rented by a Mark Armstrong from August 2014. Claiming to be representing Mrs Richards, he went to a solicitor and stated that she wanted to move to Dubai and therefore sell the property.
Under the false identity, Moorcroft sent an email to the solicitor in October of that year, stating that as opposed to waiting for a buyer, she wished to apply for a bridging loan in order to release equity.
After investigation, the mother and daughter were found guilty of conspiracy to commit fraud and have now been sentenced to three and five years in prison respectively.
Reducing the risk of fraud
As this case highlights, it is possible that your property could be at risk of being sold without your knowledge or mortgaged by a fraudster to raise money. The fraudster may also steal your identity to achieve this aim. Rectifying the mess that ensues can be extremely distressing, expensive and time-consuming for the true property owner.
To reduce your risk, it is important to first consider what types of property are most attractive to fraudsters. These include properties which are:
- Let out (because the owner is not present at the property)
- Empty (possibly because the owner is in a care home, has died, or the property is not currently occupied by a tenant)
- Of high value (the higher the value, the more money the fraudster can raise)
- Mortgage-free (it is much easier to mortgage a property that is not already mortgaged as a lender’s consent is not required) or
- Owned by someone who lives abroad and/or the Land Registry only has one contact address for the registered owner (“the address for service”), which is the property address
If any of these categories apply to your property, give consideration to the following:
- Ensure that your address for service is up to date
and one which Land Registry can use to contact you quickly if it suspects there may be fraudulent activity against your property. You can have up to three contact addresses including an email address. Apply for a restriction to be registered against your property which, once registered, requires a solicitor or conveyancer to certify that the person selling or mortgaging your property is the true owner. A similar restriction can be registered to protect property held in a company name.
- Sign up for the Land Registry’s free Property Alert Service, which will provide email alerts where there is significant activity on a property you wish to monitor (This is especially useful where an OPG court-appointed Deputy acts on behalf of a client or, for probate cases, where an executor is dealing with the disposal of an estate).
- Consider, if your property is not registered at Land Registry, an application for voluntary registration. If you are a victim of fraud and your property is not registered at Land Registry any chance of possible compensation is not available.
If you believe you may already be a victim of property fraud you can contact Land Registry’s fraud line on 0300 006 7030 or by email at: firstname.lastname@example.org. You can also report it to Action Fraud at www.actionfraud.police.uk
Remember, prevention is always better than cure so if you adopt the above preventative measures you will be making it much harder for the fraudster to target your property.
Lynette Mann is a Legal Executive within Berwins’ industry ranked Residential Property team. She has over 20 years of experience in property law.