Buy to let property scam netted £450,000Make Text Bigger
A sham property investment company that conned landlords out of £450,000 has been wound up by the Insolvency Service.
Modo Homes Group lied to investors about selling repossessed properties on behalf of banks and building societies – and demanded fees from landlords to arrange viewings.
After complaints, the Insolvency Service investigated the company and discovered the directors were deliberately misleading investors and had never sold a property.
The High Court heard that the company, based in Liverpool, conned investors by:
- Demanding reservation fees before releasing property addresses which stopped investors from carrying out due diligence checks to verify the details of the investment offer
- Failing to tell investors that the fee was non-refundable
- Failing to provide invoices and receipts, and failed to answer calls and letters from investors
- Stopping valuers commissioned by investors from visiting properties
- Marketing properties without permission of the owners
- Collecting multiple reservation fees for the same property
The company failed to provide any accounting records, which the directors claimed had been mistakenly thrown into a skip by workmen carrying out some work on their home.
The company’s bank records show that it had received £454,737 from would-be investors.
Colin Cronin, of the Insolvency Service, said: “Modo Homes Group raised money from investors on false representations and then made it very difficult for investors to contact the company to progress the property purchase.
“These proceedings show that the Insolvency Service will take firm action against companies and directors which operate in this way.”
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