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Property fraud is on the rise and buyers and sellers should be extra vigilant, says Chris Tyson, CEO of Tyson Properties.

Property fraud is on the rise and buyers
and sellers should be extra vigilant, says
Chris Tyson, CEO of Tyson Properties.
The fastest-growing property fraud is
digital, says Tyson. 

Tim Akinnusi, executive head: sales
and client management in home loans at
Nedbank, says one of the most common is
hacking into emails or redirecting funds to
new beneficiary accounts. 
Darren Brander, a director and
conveyancer at national law firm Smith
Tabata Buchanan Boyes, agrees it is
becoming increasingly common for
fraudsters to intercept or simulate
communications between their clients
or between attorneys and their clients in
property-transfer transactions. 
He believes property-related fraud
has increased because deposits paid on
property transactions and the proceeds of a
sale represent significant amounts. 
“Often buyers are requested to pay the
deposit on a property transaction into an
attorney’s trust account or into the agent’s
trust account just after acceptance of an
offer. Fraudsters intercept these requests
and use the details to create alternative
emails which look like those sent by agents
or attorneys. These advise the client of a
change in banking details.” 
Clients are then asked to pay the deposit
into the “new” banking account.
He says fraudsters seem to be aware
when property transactions are about to be registered. 
“The same modus operandi seems to
be applied to communication between
the attorney and client when arranging
payment of the purchase price to the seller,
after registration. It is during this period that
sellers, buyers, agents and attorneys must
be most vigilant,” he warns. 
Brander suggests buyers and sellers ask
for verification of the bank account into
which any funds are being paid. He says
emails requesting a change of banking
details should be viewed with suspicion. 
All requests via email should be checked
against previous mails received from the
same supposed sender. Fraudulent mails are
often sent from accounts that are similar,
but never identical to the original email
Important documents should at all times
be signed in person, and verification of
bank details always completed. 
“We regularly advise clients that we
never send an email requesting a change of
banking details,” he says.
Akinnusi says banks are urging clients to
never disclose material information online. 
“As much as possible, share critical
information in person only,” he says. 
Clients should make sure an offer to
purchase is comprehensive and all critical
information is included, especially all details
of buyer and seller and the address of the
property Tyson
says the
risk of fraud
is not confined
to home loans. 
“Cash deals, no
matter how
enticing, can
also pose great
risks. Always
insist on a
deposit prior to
occupation.” Brander concurs:
“An unwitting seller may believe the cash
deal to be secure, but he is in an unenvious
position if the purchaser insists on only
parting with his cash after transfer into
the purchaser’s name is effected. The seller risks not being paid at all, after allowing
ownership to pass.” 
Akinnusi advises both buyers and sellers
to use only registered and reputable estate
agents and approved conveyancers. 
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