The Property Market Needs To Stay On High Alert For Fraud

Fraud is a fact of life and the potential payoff for property-related fraud can be very high. This means that everyone involved in the property market needs to stay vigilant about it. Here’s a quick guide to what you need to know.

There are different types of property fraud

Some of the most common types of (attempted) property fraud include:

  • Money laundering
  • Investment scams
  • Fund interceptions
  • Identity theft

These can all be implemented in various ways. Ultimately, however, all frauds require you to trust someone who shouldn’t be trusted.

Money laundering

Money laundering tends to be an issue for property professionals to handle. As a regular buyer or seller, your only experience of this is likely to be having to provide ID. For completeness, it’s increasingly likely that this will be verified electronically. This is to protect against forgery, which is now highly sophisticated.

That said, it is not out of the question that you will find yourself approached by someone wanting you to act as a “money mule”. The simple way to protect yourself is just to say no. No matter what they offer you, it’s not worth the risk.

Investment scams

You can be targeted by an investment scam even when you’re not actively looking to buy or sell property. The way to protect yourself against investment property scams is the same as the way to protect yourself against investment scams in general. Make sure you do thorough due diligence before you decide whether or not to part with any cash.

In particular, be clear about whether or not the scheme is covered by any industry bodies or regulators. These do not guarantee that an investment is legitimate, let alone that it will be successful. They can, however, be a lot better than nothing.

Fund interceptions

Fund interception works by persuading the victim to transfer funds to a scammer rather than a legitimate recipient. The scammer often achieves this by pretending to be someone the victim knows and trusts. It may even be someone from whom they were expecting a legitimate bill.

As with investment scams, the key to protecting yourself against funds interception is to be sure you know who you’re dealing with. Find out both the contact details and the bank details of your legitimate key contacts (e.g. your solicitor) and only use those contact details.

Be aware that both phone numbers and emails can be “spoofed” (impersonated) as well as hacked. Always verify any contact by calling or emailing the known contact details. Never let yourself be pressured into taking hasty actions. Remember the old saying – act in haste, repent at leisure.

Identity theft

Your identity has a value, especially if you’re a homeowner (or about to become one). You, therefore, need to be careful to protect it. Here are some ideas.

Keep your mail secure

You may not get much postal mail these days, but you still need to ensure that what you do get is kept safe from prying eyes (and fingers). Once you’ve read it, shred it. If you don’t get enough mail to justify a shredder, then a pair of scissors will do. Just remember to cut finely and cut in both directions.

Protect all your devices

Any device with a mainstream operating system (e.g. Windows, macOS, Android and iOS) should have plenty of security software available for it. Make sure you at least download one of the free antimalware programs. Consider investing in one of the paid-for offerings. In particular, look for one with advanced message-filtering capability. This can help to protect you from scam emails.

For devices that don’t have proper security software, make sure you use a strong and unique password.

Use two-factor authentication whenever you can

Two-factor authentication combines something you know (your password) with something you have (usually a one-time code). It can do a lot to improve the safety of your accounts.

Please contact us for more information.

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