Average Property Scam Costs Victims £107,669

Average Property Scam Costs Victims £107,669

14:12 PM, 5th September 2019, About 4 years ago

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All property titles (in England and Wales) are published online and scammers can access this information to commit property fraud by forging your identity.

You’re probably thinking that this isn’t likely to happen to you. However, research by ABC Finance has uncovered that there are twice as many property fraud claims than there are prevented cases suggesting that this scam is something that could affect any of us.

To help raise awareness, ABC Finance submitted a Freedom of Information Request (FOI) to the UK Land Registry to delve into the extent of the issue: https://abcfinance.co.uk/blog/is-the-uk-in-a-property-fraud-crisis/

UK Property fraud facts and figures:

In the last 14 years, 678 property fraud claims have been made – with the total pay-out amounting to £73.3 million.

This means that the average property scam pay-out stands at £107,669. As a comparison, online scams – which receive a lot of press – set the average victim back £600.

Property fraud accounts for 71% of fraud within UK local authorities. Comparatively, council tax has the second-highest rate of fraud but only accounts for 9%.

It isn’t just homeowners that have to be aware of scammers – renting is also rife with potential for fraud. Between 2014-2018, victims of rent-related-fraud reported losses of £22.1m – with the scam costing the average renter £1,396.

How to spot a property fraud scam

What’s most shocking is the simplicity with which property fraud can take place with all property titles (in England and Wales) are published online.

One way a fraudster may utilise this information is by taking out a mortgage using the victim’s identity. They would place some of their cash into an account and make a few repayments for the mortgage before removing the money. The mortgage lender is then only made aware once the dummy account runs out. The victim – the property deed holder – is then left liable for the debts incurred.

To prevent this from happening, ABC Finance spoke to the HomeOwners Alliance who suggested using “the free Land Registry Property Alert Service” which sends you an email alert if there is any activity occurring. Or “for more reassurance, you may want to put a restriction on the title deed of your property. This stops the Land Registry from registering a sale or mortgage unless a conveyancer certifies the application was made by you.”

There have also been cases of people going to solicitors, impersonating the current owners and asking for the deeds to be transferred to someone they claim is a relative but is actually a scammer who will look to apply a mortgage and profit from it.

 Unfortunately, this is just one of the many ways property fraud can take place. There are 7 types of rental scams and 8 types of mortgage scams.

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