Fraud Focus

During tough economic times, it comes as no surprise to me that people turn to crime. 
I believe that, because deposits paid on property transactions and the proceeds of a sale represent significant amounts of money, it is inevitable that property fraud will become increasingly common.  
My greatest concern, though, is that property owners, buyers and sellers can least afford to become victims of crime when times are tight. 

As you will know, any statistics that track crime in South Africa are hard to come by. But, from your own experience, you will know that there are more house robberies and car hijackings. Similarly, our own experience as well as that of respected associates in the legal and banking sectors, point to the fact that fraudulent activities within the property sphere are increasing. 

For this reason, we have embarked on a publicity campaign to educate both existing and potential clients of the dangers. Those who are knowledgeable about what is happening are the best equipped to avoid becoming the victims of criminals. 

With this in mind, I would like to urge you to be aware of some the different types of crimes taking place.

Identity theft – Guard your personal information (such as identity and banking account numbers) and carefully file or destroy confidential documents. Recently, a property owner wishing to sell his property learnt that an imposter had obtained his signature for what he thought was a bank loan - only to find out later that the imposter had, in fact, sold his property to a third party! The opposite also happens – imposters can buy properties or apply for loans in your name. 

Falsifying documents – Banks are seeing increasing numbers of falsified documents such as pay slips to secure bond approvals. When this is uncovered and a bond approval retracted, the sale falls through. In such instances costs incurred by sellers, estate agents and conveyancers remain unsettled. Failed sales can also impact your ability to buy your next home.  

Hacking into emails – In a busy world, emails are becoming the easiest and most common means of communication. Often buyers are asked to pay the deposit on a property transaction into an attorney’s trust account or, alternatively, into the agent’s trust account just after acceptance of an offer.  This is a common stipulation in a sale agreement of immovable property. Fraudsters have found ways intercept these requests and then use the details on them to create alternative emails which look just like those send by agents or attorneys. These advise the client of a change in banking details and then ask him or her to pay the deposit into the ‘new’ banking account.   

Our top tips for avoiding property fraud: 

•    View all mails requesting a change of banking details with suspicion. 
•    Ask for verification of the bank account to which any funds are being paid.
•    Check all mails with requests against previous mails received from the same supposed sender. Fraudulent mails are often sent from accounts that are very similar but never identical to the original email addresses.
•    Wherever possible, sign important documents and share critical information in person. 
•    Never sign a blank document. Make sure that an Offer to Purchase (OTP) is comprehensive and that all critical information is included, especially all details of the buyer and the seller and the address of the property. An incomplete or blank OTP is an absolute no-no. 
•    Cash deals, no matter how enticing, can also pose great risks. Always insist on a deposit prior to occupation.
•    Use only registered and reputable estate agents. Recently, a home owner who is trying to sell her house received a phone call from an agent from an unknown real estate agency asking if she could show her home to one of her clients for whom the home would be ideal. Those eager to sell their properties might be easily drawn in. However, this seller contacted the mandated agent. It transpired that the ‘interested’ agent is not registered with the Estate Agents Affairs Board and nobody had heard of the real estate agency for which she claimed to work. 
•    Ask people you trust such as your Tyson Properties agent or your bank to recommend a conveyancer if you do not have one.
•    Never be afraid to ask to proof of affiliations, registrations and qualifications. We will happily provide you with proof of certifications, VAT numbers and tax registrations. Our agents are also able to show you their current Fidelity Fund Certificates.  
•    Never be afraid to check and recheck everything that’s material to the transaction. 
•    Sign a sole mandate. That way you are dealing with someone you can trust to act in your best interests at all times by screening potential buyers and structuring deals correctly.