Beware identity fraud.
Identity theft is on the rise, and has been used to perpetrate property fraud in several recent cases. The methods used by fraudsters are also becoming more sophisticated. The onus is on all of us to take personal responsibility for protecting our identity, and also for checking the true identity of people posing as property owners.
The Queensland Government has published some guidelines to help you protect yourself and your business against property fraud, and we summarise the main points here.
Don’t put yourself, your clients or your business at risk.
Details vary in the recent cases, but they had in common that property was sold without the true owner’s consent. To prevent a fraudulent transaction, the onus is on real estate agents, sales people and auctioneers to thoroughly check a person’s identity before listing a property for sale.
Beware the following red flags, in isolation or especially in combination:
- a recent change of address or other personal details, not provided until after instructions to sell
- overseas vendors, or documents issued overseas or witnessed by people overseas
- requests for funds to be sent to offshore accounts or accounts not usually used by the client
- advice the sale is urgent due to unsubstantiated family illness or overseas investment opportunities
- new generic email addresses, especially hotmail, yahoo or gmail.
The government guidelines recommend using a current title search, and verifying the basic characteristics of the property, such as its description, the full names of the owners, and whether it is owned by a legal entity such as a trust.
You are breaking the law if you ignore your responsibilities to check true ownership of a property, and its characteristics and approvals and compliance.
Manage risks
We recommend you devise, and ensure you and your team strictly adhere to, a documented procedure for handling contact and banking detail changes, escalating unusual occurrences and handling sales when the owners themselves are not able to be present in person. Keep yourself, your clients and your business safe by:
- keeping accurate records
- confirming key details (e.g., that signatures match)
- conducting 100-point identity checks
- keeping a register of client signatures
- keeping records of any odd or suspicious interactions with clients
- completing property sales in person wherever possible.