Property and mortgage fraud—warning signs and good practice for staff

The following Practice Compliance practice note provides comprehensive and up to date legal information covering:

  • Property and mortgage fraud—warning signs and good practice for staff
  • Warning signs—the people involved
  • Warning signs—the property
  • Warning signs—the money
  • Warning signs—the transaction
  • Good Practice

Property and mortgage fraud—warning signs and good practice for staff

You do not have to behave like a police officer but you do have to remain alert to the warning signs of property and mortgage fraud and make the sort of enquiries that a reasonable person (with the same qualifications, knowledge and experience as you) would make.

Typical signs of property and mortgage fraud can be divided into four main categories:

  1. the people

  2. the property

  3. the money, and

  4. the transaction

Typical warning signs for each category are shown below, but the list is are not exhaustive. These factors do not automatically mean that property and mortgage fraud is taking place—they are merely red flags. However, you should pay particular attention to matters where a number of factors are present.

Warning signs—the people involved

  1. Unexplained long geographical distances between the buyer's current address and their new property.

  2. The client is located a long distance from our office (this is particularly relevant for new clients but is unlikely to be relevant for volume conveyancing firms).

  3. The client seems unusually disinterested in their purchase—look for other warning signs that suggest they are not the real purchaser.

  4. The client does not usually engage in property transactions of this scale—consider why they are undertaking this transaction and how they are funding it.

  5. The client's credit history is shorter than you would expect for

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