Property hijacking and identity fraud
Monday, July 09, 2018
They say selling or buying a house is one of the most stressful events in life. Well, imagine finding out that the house you have just bought isn’t legally yours, because the person selling it doesn’t actually own it and has disappeared with all your money. Sounds awful, doesn’t it?
Last week in the US a man was indicted for 25 counts of ‘property hijacking’. He is accused of scheming to falsely claim ownership of multiple properties and sell them on, by targeting vacant houses as well as those owned by the elderly and the deceased.
However, this is not just a problem across the pond. According to figures from Land Registry, the official register of property ownership in England and Wales, the value of property deed fraud has more than tripled since 2013. And it’s continuing to grow. As a result regulators and the police are ramping up their advice to owners on how to avoid falling victim to the crime.
The most common form of the scam is through identity fraud. Criminals change their name by deed poll to match the owner or recently deceased owners’ name and then puts the property on the market and sells it to a cash buyer. It is only when the buyer goes to register the change of ownership with Land Registry that the true owner is alerted. Whilst the true owner or estate of the owner will get their house back, the cash buyer rarely sees their money again. A variety of the scam is mortgaging or re-mortgaging the property, again by assuming the identity of the home owner.
To counter this growing problem Land Registry has set up a counter fraud unit which works closely with the police and other agencies to reduce the risk of property fraud. To date it has prevented frauds on 254 applications, representing properties valued in excess of £117m. However, mortgage lenders and estate agents can help prevent this type of fraud from happening by running mortgage applications and home sellers details against deceased identity fraud prevention products such as Halo. Such solutions reduce the risk of criminals using the personal details of people that have died by matching the data against verified death records. Any matches can be further investigated minimising the chance of mortgages being fraudulently granted or houses being sold by bogus sellers. Stopping this type of fraud at the offset not only potentially saves millions of pounds each year, but also protects consumers against one of the most stressful crimes currently being carried out today.