Fraud
Fraud is fast becoming the crime of the 21st century. In the UK, the Solicitors' Regulation Authority published figures to March 2008 showing 110 mortgage advances wrere stolen and 1,231 incidents of client account theft. BDO Stoy Hayward predict mortgage fraud will cost lenders at least £1bn this year.
Property fraud typically involves using stolen identities or forged documents to either fraudulently discharge an existing mortgage before obtaining a new mortgage or selling a property without the true owner being aware of it.
The below are just some of the many examples where fraud can have devastating consequences:
- Case study 1: Conveyancers 'vulnerable' as mortgage fraud continues to rise
- Case study 2: Fraud victims 'lucky' to get help
- Case study 3: £1 million mortgage fraud doctor jailed
- Case study 4: Solicitor denies £650,000 property scams
- Case study 5: Fraud investigator in multi-million pound property fraud
- Case study 6: First Title claim example
- Case study 7: 14 in court on North Wales mortgage £20m fraud charges
Conveyancers 'vulnerable' as mortgage fraud continues to rise
http://www.lawgazette.co.uk/news/conveyancers-039vulnerable039-mortgage-fraud-continues-rise
The latest figures from the SRA showed that cases of mortgage fraud continue to rise. Peter Rodd, a member of the Law Society's money laundering task force, said much of the £15bn of criminal funds laundered in the UK every year is filtered through property transactions. He said that conveyancers are uniquely vulnerable to criminals and that they are typically failing to question the source of funds "because of the need to avoid delays."
Fraud victims 'lucky' to get help
http://news.bbc.co.uk/1/hi/uk/7611288.stm
David Kirk, director of the Fraud Prosecution Service for England & Wales, said victims of fraud have to be '"lucky" to get it investigated. Even though fraud is estimated to cost about £20 billion a year, Mr Kirh said "police priority for fraud investigation is low".According to him, the credit crunch is the main reason why organised crime is moving into mortgage fraud. Mr Kirk also added: "If you are a victim of a violent assault, that's a terrible thing. But it's also awful to have your life savings stolen by a fraudulent investment scheme that will ruin the rest of your life. It's not a victimless crime."
£1 million mortgage fraud doctor jailed
http://news.bbc.co.uk/1/hi/england/london/7007382.stm
A newly-qualified doctor has been jailed for 27 months for trying to carry out a £1 million mortgage fraud. Following something of a breakdown at work, Mr Haider left his job and his debts spiralled out of control. He then paid £16,000 for false documents and applied for loans across Britain. All but one of the lenders he approached became suspicious and refused his applications. The judge said: "It is a tragedy to see a man of your clear ability and intelligence standing in the dock admitting dishonesty."
Solicitor denies £650,000 property scams
http://www.thisissouthwales.co.uk/news/Lawyer-stands-accused-alleged-scam/article-2544576-detail/article.html
A solicitor has appeared in court charged with money laundering and fraud in an alleged £650,000 property scam. He faces 16 charges relating to false and misleading statements on mortgage applications. He is accused of 8 counts of transferring criminal property and 8 counts of fraud. One of the charges states that he commited fraud by making a false representation to Bradford and Bingley by giving a "false certificate of title in relation to the purchase" of a property. He was granted bail on the condition that he does not contact any prosecution witnesses.
Fraud investigator in multi-million pound property fraud
A police fraud investigator, who admitted five counts of obtaining property by deception and possession of a false identity, was sentenced to five years and nine months in prison. His businessman brother and a solicitor's clerk were also involved in the multi-million pound fraud. They bought eight flats and pretended to provide funding for a purchase of a property, even though none was needed, sent solicitor firms false information, signed off bogus documents and lied on loan applications in order to obtain 33 properties all over the country. The overall fraud committed by the trio is estimated at £4.5 million.
14 in court on North Wales mortgage £20m fraud charges
FOURTEEN people appeared in court yesterday charged over an alleged £20m mortgage fraud conspiracy. Solicitor Nicholas John Jones, 52, of Bryntirion, Leeswood, near Mold, was one of the accused, who include surveyors, valuers and mortgage advisers. It follows a two-year investigation by North Wales Police into alleged multiple fraudulent mortgage applications.
First Title claim example
The insured mortgagee advanced a mortgage to the borrowers, Mr & Mrs X, on the security of the first legal mortgage over their property. The borrowers subsequently went into arrears on their repayments and the insured mortgagee commenced possession proceedings. One of the borrowers, Mrs X, raised a defence on the basis that her husband had forged her signature on the mortgage deed. We accepted the matter as a claim and sent the file to our panel solicitor. A jointly instructed handwriting expert produced a report confirming that Mrs X had not signed the deed, and Mrs X produced further documentary evidence to support her defence. It appears that Mr X systematically stole his wife's assets and forged her signature on several occasions to obtain mortgages and loans in their joint names. We applied for an order for sale in the mortgagee's name, based on their equitable mortgage over Mr X's interest in the property and eventually agreed terms for a voluntary sale of the property.