Mortgage ID fraud on the rise

Fraudsters are impersonating solicitors and even the dead in order to steal money.

There's been a worrying jump in the number of identity thieves attempting to commit mortgage fraud, according to new research from Experian.

The credit checking agency found that fraud during mortgage and property transactions rose 50% in the last year, making up 6% of all fraud. That's the highest level seen since 2012, Experian says.

Fraudsters have even been impersonating the recently deceased to make mortgage applications, but more commonly they will pretend to be solicitors to trick buyers into sending them large sums of money.

Want to check your credit report? Get a free 30-day trial

How the scams work

In order to impersonate the dead, fraudsters steal the identity of people who have recently passed away but who previously lived at a property to take out a mortgage in their name.

They then use a fake solicitor to receive the funds from a lender and cash them in.

However, a bigger problem is the rising number of cases where cash is stolen from buyers in the middle of a property transaction.

In many cases, Experian says fraudsters hack databases or intercept emails between buyers and their solicitors about a property purchase.

Using the information they can then pose as the solicitor and trick buyers into diverting large payments, only to disappear with the cash.

Action Fraud said this type of fraud known as conveyancing fraud accounted for 36 cases between November 2015 and January 2016, with victims losing an average £76,166.

Experian's Nick Mothershaw describes the rise in this sort of fraud as "worrying".

He explains: "Third party mortgage fraud is very complex and not as easy to commit on a large scale as fraud related to other financial products, such as current accounts, can be. Because of the values involved, the impact on people’s lives can be devastating."

How to avoid it

The Conveyancing Association, the trade body for the industry, said: "Customers have lost tens of thousands of pounds plus their potential new home as a result of this fraud."

It’s launching a Cyber Safe Scheme, which has new standards for members to help protect buyers from this growing threat.

The trade body recommends sending a small amount and checking with the law firm to be confident the money, or only using secure communications to send bank details.

Action Fraud also has some tips on how to avoid falling victim to these scams, which include:

• Call the person or company to ensure you are dealing with them directly.
• Don’t transfer your money all at once. If you are transferring large sums of money, transfer a small amount first such as £1 and call the recipient to make sure it has cleared.
• Remember fraudsters can easily spoof the email address to make them appear legitimate, so be wary of threatening or urgent language.
• Don’t believe everything you see; just because an email appears to come from a trusted source, it doesn’t mean that it is legitimate.

If you have fallen victim to property transaction or conveyancing scam inform your bank immediately and report it to Action Fraud.

Keep safe with loveMONEY:

Phone scams: victims lose cash after missed calls

New warning over Cape Verde pension scams

Thousands fall victim to mandate fraud - here's how to spot it