Property News

Homebuyers and Tenants Warned of Deposit Scam

Em Morley - January 11, 2016

Online fraudsters are stealing millions of pounds from property buyers and vendors in a conveyancing scam.

The crimes are reported to be growing and are worth an average of more than £112,000.

Homebuyers and Tenants Warned of Deposit Scam

Homebuyers and Tenants Warned of Deposit Scam

Estate agent Chestertons is so concerned by the scams that it has compiled a list of tips for sellers and buyers to avoid the fraud, which cons those moving home out of their deposits.

Chestertons warns that similar scams could also hit private tenants waiting to sign tenancy agreements and pay deposits and rent.

Police believe that foreign crime syndicates could be responsible for the scams, by which criminals hack into the email correspondence between vendors, buyers, solicitors and estate agents.

The fraudsters then send an authentic-looking email, often on the day of completion, telling the buyer or the buyer’s solicitor that the bank account details of the conveyancer have changed. The criminals then empty the bank account with the new details.

Action Fraud reports that there were 91 of these cases up until October last year – the last month for which data is available.

In September and October alone, 16 cases were reported.

The Deputy Head of Action Fraud, Steve Proffitt, comments: “We are getting more and more instances of this. The outcome for the fraudster is tremendous. They can earn £1m on the sale of a house in the South East.”1 

Chestertons advises home movers – including tenants – to only give out sensitive information, such as bank details, over the phone or in branch, not over email.

It says that house hunters using property portals to find their next home should be especially wary of registering to receive details.

The firm warns that cyber criminals are very aware of the timescales involved in buying homes and know when deposits, including tenancy deposits, are likely to be transferred.

It insists: “You should be careful about how much information you share, especially if there is no pre-existing relationship with the firm that you’re contacting.

“Remember to give just enough details for agents, surveyors or lenders to get in touch with you as required and understand your basic requirements. Do not give any bank details.”

Read the full guide here: http://www.chestertons.com/research-and-insight/insights/chestertons-guide-to-avoiding-cybercrime-during-a-property-transaction/

1 http://www.propertyindustryeye.com/property-frauds-escalating-as-buyers-and-tenants-are-robbed/