“It is unclear how many people may have been responsible for the sophisticated scam that shocked Canberra’s real estate industry.”
Frightening facts have emerged of how scammers duped a Canberra real estate agent into selling a client’s property without her knowledge. The true owner is now involved in a serious legal battle to claim compensation for the fraudulent transaction.
Identity theft is on the rise. Fraudsters are using increasingly sophisticated methods to pose as the true owners of the property and to attempt to deceive agents and lawyers involved.
The Queensland Government has published some vital information on how you can avoid being targeted. We have summarised this below.
What are my legal responsibilities as an agent?
You must take reasonable steps to find out (i) that the person you are dealing with is who they claim to be and (ii) that they have authority to sell or manage the property.
Know the warning signs
Commonly, a fraudster will try to post as the true property owner and update contact details and banking details. It is important your office has a documented policy as to how these changes should be verified and documented. All staff (including support staff) should be made aware of how important these procedures are.
When should alarm bells be raised?
Change in contact details
- someone tries to change details on behalf of a client
- changes to a generic email account (eg. Hotmail, yahoo)
- inconsistency with what is in your records
- requests for funds to be sent to a different account (especially overseas)
- written communication becomes unusual unusual words used, poor spelling etc)
- correspondence coming from overseas email addresses
- urgent sale requests
- incentives for quick sales
- vague reasons and explanations for instructions
The Government recommends that you minimise your risk by:
- keeping accurate records
- referring to your records to confirm key details (such as matching signatures);
- identifying your client by conducting a 100-point identity check
- keeping a register of all clients’ original signatures to check against
- keeping records of any unique or unusual discussions
- always trying to have the seller sign in front of you in person (if possible).
If not already in place, we recommend that your office has a documented procedure for handling contact and banking details changes, escalating unusual requests and for listing a property for sale when the owner is not able to be present. Your team should be made aware of the procedures and possible risks associated with land title fraud.