What is property hijacking and how can landlords avoid it?
Property fraud is on the rise, with £24.9m lost in the year to April 2017 through property hijacking. Could you be a victim of the latest scam?
Welsh accountant and tax advisor Green & Co is the latest expert to warn property owners of hijacking scams after it emerged that one homeowner had potentially lost more than £400,000 due to fraud.
The victim had let out their property to long-term tenants, one of which had then claimed to be the homeowners and managed to sell the house to an unsuspecting buyer.
Property hijacking typically sees the tenants – posing as sellers – changing their name by deed poll to match that of the property owner, before acquiring new identification under the assumed name. They criminal then approaches estate agents, solicitors and surveyors using the false ID, and puts the house on the market. They will look for a quick sale to reduce the chances of being caught before it goes through, often asking the estate agents to look for cash buyers only, and houses that aren’t mortgaged are often prime targets.
Green & Co said in its blog: “Since the estate agent and solicitor had completed all the identification checks, the property owner has been informed that he is unlikely to get any of his money back. The matter is currently with the police.”
According to the Land Registry, instances of this type of crime have tripled over the past four years, from £7.2m worth of fraud in 2013 up to £24.9m this year, with 50 such crimes reported in 2016/2017 – although as many as 254 fraudulent applications have been exposed and prevented since 2009.
Don’t be a target
The scam is normally only revealed after the sale of the property has gone through, when the new owner goes to the Land Registry to register the change of ownership and the true owner is then alerted. Sadly, although the original owner normally gets their house back, often the unsuspecting buyer is the one that is stung, as the criminals have already made off with the cash.
There are a number of warning signs that can alert homeowners, buyers and solicitors, as well as estate agents, that something is amiss, which is one way landlords can avoid being targeted.
Detective Constable Richard Kirk of the Metropolitan Police set out some key things to look out for, including:
- Tenants pressuring agents to get the keys and move in very quickly
- Tenants taking on a new property for it then to be left empty
- Brand new passports presented to agents and solicitors, as they may have just been acquired for the purpose
Landlords can sign up to an alert service through HM Land Registry, which sends an email if a property you have registered has any activity on it, like changing ownership.
All landlords are being urged to be vigilant, although the chances of being subject to this type of fraud are still relatively low.
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