In an ever increasing world of technology, so the instances of property fraud and sophisticated methods of the fraudsters are on the rise.
So, what are the common frauds and how do I protect myself from them?
Fraudsters usually target people in one of two ways. The first is by intercepting communications between you and your solicitor by installing malware, often known as Trojan horses, on your computer. This allows them to take advantage at the key moment in the process when monies are transferred on the purchase or sale of a property.
The second is by posing as the actual seller of the property and selling the same via a fraudulent or unwitting solicitor.
Let us look at the first scenario.
During a purchase transaction, your solicitor will usually require three payments from you. The first is a relatively small amount on account of searches and other disbursements to get the transaction underway. The second is the deposit, which is usually 10% of the purchase price, and the third the balance of monies required to complete the transaction.
On a sale it is usual for your solicitor to send the net sale proceeds direct to your account.
Most solicitors request that you pay monies to them by bank transfer. This is where the problems can begin. If your computer has been compromised by hackers by, for example, the installation of a Trojan horse, the hacker can have access to the whole of your computer. We have heard of instances where emails to or from solicitors are intercepted by the hackers, deleted or requested to be ignored and replaced by emails with alternative bank details to send monies to. Those bank details are actually the hacker’s as opposed to the lawyer’s.
At Alexander JLO we advise clients of our bank details in writing at the outset of the transaction. We also advise clients that our bank details will not change throughout the transaction so you can be safe in the knowledge that (comma deleted) if somebody does request you to send the deposit or balance to an alternative account, it is probably a fraud and should be reported to us and to the police. We also advise that it is best to confirm with your solicitor the bank details over the telephone before sending any funds.
On a sale, we will always request from you a copy of your ID, a recent bank statement for the account that monies are to be transferred to and will always call you to confirm your bank details before sending monies as a final precaution against fraud. You should ask your solicitors to do likewise if they do not adopt this procedure.
So what about the second scenario?
This is most common with properties that are mortgage free and often empty or tenanted. In these circumstances, the fraudster actually adopts the identity of the real property owner and sells to an unwitting buyer. Whilst examples of this type of fraud are rare, they are increasing so how, you ask can you protect yourself?
If you own a property outright, you may well hold the deeds and think this will be sufficient protection against the fraudster. Unfortunately, think again! Deeds no longer exist and it is possible to sell a property with just downloads from the Land Registry. In fact, most properties are now sold this way.
There are two mains ways that you can protect what is often your most valuable asset. The first is by registering a restriction against your own property which confirms that the lawyer handling the sale must be fully satisfied of the identity of the seller. This would usually put any lawyer on notice that there is an additional level of protection in place.
The second is to register your property on the Land Registry’s free property monitoring service. This basically sends you an email if anyone has accessed the title to your property. Further investigations can show who and when. Details of the service can be found at
For further information about fraud prevention and how we can assist please do not hesitate to contact us.