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Protect your property from fraud

07 Jan 2014

Paul Illes, a solicitor in our residential property team explains why property fraud is a major concern and provides the steps you should take to avoid becoming an innocent victim of fraud.

Your property is probably the most valuable asset you own. It can be sold and mortgaged to raise money and is therefore an attractive target for fraudsters.

Property fraud happens in many ways. Most commonly fraudsters “steal” property by impersonating the registered owner and either sell or mortgage their home without their knowledge, disappearing with the proceeds.

For over twenty years the title of all registered properties has been open to the public for inspection, providing a great aide for fraudsters. For £3 anybody can establish the name of the owner of a registered property and whether they have a mortgage.

Solicitors, professional conveyancers, the Land Registry and mortgage lenders all have safeguards to minimise the risk of a fraud being successful. However, it is important that property owners do what they can to help prevent fraud and to protect their home in the same way that they protect other assets they own.

Between September 2009 and April 2013 the Land Registry stopped 136 fraudulent applications on properties worth an estimated £60 million.

Anyone owning an interest in property can be the victim of property fraud, however there is an increased risk of fraud occurring when:

  • The property is empty or has been bought-to-let;
  • The property owner spends time abroad or away from the property;
  • The property has no mortgage;
  • The owner is infirm or in a nursing home; and
  • The property owners’ relationship breaks down.

Four simple acts can help protect you against property fraud:

  • Ensure your property is registered;
  • Ensure your contact details are up to date;
  • Register a restriction; and
  • Subscribe to Property Alert.

About 20 percent of land in England and Wales remains unregistered. Registration provides an up-to-date official record of who owns the land, gives you greater security and you may be compensated by the Land Registry if you are an innocent victim of fraud.

When ownership of your property is registered, an “address for service” is provided to the Land Registry. This is the address to which the Land Registry and other parties will send letters and notices if they need to contact you, so this must be kept up to date. If your contact details are not correct it is unlikely that any party will be able to contact you, which could be instrumental in preventing fraud. Up to three different addresses, including an email address and / or an address abroad can be provided to the Land Registry for any property.

Restrictions are an important additional security measure introduced by the Land Registry reducing the risk of property fraud occurring by fraudsters impersonating a property owner or submitting a fraudulent personal application to the Land Registry.

Registering a Form LL restriction with the Land Registry ensures there will be no dealings with your property unless a solicitor or other professional conveyancer certifies they have checked the identity of the person who has executed the documents submitted for registration and that they are the registered owner.

The Land Registry has also just announced a new free service to help protect against property fraud called Property Alert. This is a free property monitoring service aimed at anyone who might be concerned that their property could be at risk of property fraud.

Once registered with Property Alert, property owners will receive email notifications when official search requests and applications against monitored properties are received, allowing the owner to take necessary action against suspicious activity.

If you are concerned about property fraud and would like to register your property or register a restriction against your property’s title, contact Paul Illes on 0191 232 8345 or email: paul.illes@hay-kilner.co.uk