Reading recently about the conveyancer who was jailed for swindling his clients and the HMRC out of £352.5k worth of stamp duty land tax payments, reminded me just how property/mortgage fraud can come from all types of sources and through all kinds of different strategies.
Which client of Anthony Maragh would have thought for one second that he was creaming off thousands of pounds worth of stamp duty payments by lying about the true value of their properties? I expect not one at all – indeed, of all those practitioners who take part in a housing transaction, I’m pretty sure that clients would think the person least likely to be involved in any kind of fraud, would be the legal expert in all of this.
And yet, we should be reminded here that – wait for it – solicitors are also human beings and, regardless of them operating within the law, they are not immune to breaking it. In this case, and many others, the lure of money and the greed of individuals means that, regardless of the risk, there are always going to be those that can be tempted to break the law. Clearly, Maragh was one of those – and the fact he was willing to take the risk 43 times suggests he was prolific in carrying out such activity and thought himself immune to capture.
For advisers and clients, cases such as this will bring home the potential threat that can exist within a conveyancing transaction, especially if they have very little information about the conveyancer concerned, the firm they work for, their experience and their ability to carry out the work to a high standard. It stands to reason that clients are even less likely to have this knowledge, to have carried out such due diligence, and therefore be anywhere near 100% confident in their choice of individual/firm.
Add in the recommendation of a mortgage adviser though and, the fact that they would hopefully have used a distributor like ourselves who has carried out the necessary background checks (and then some) on the firm, and that level of client confidence should grow significantly. This is another reason why advisers are in the perfect position to offer that conveyancing recommendation and to hopefully help steer their clients away from those who may be intent on defrauding them.
In the narrative of mortgage fraud activity this particular case seems outside the norm because invariably we hear about individual ‘borrowers’ who have attempted to dupe and defraud lenders. However, the amount of times this type of fraud also requires a willing solicitor participant will be high and, as the industry takes the fight back to the fraudsters and all participants, we have seen a far greater number of cases in which the solicitor is not just complicit but actively at the centre of the fraud.
It is obviously heartening to see the work being carried out to stop such fraud but it’s also the case that while we are talking about such serious sums of money, the temptation will always exist. Therefore, advisers who actively involve themselves in the conveyancing process will be doing much to ward off the fraud threat, especially when using a distributor who is continually carrying out this sort of work with its panel firms to ensure there is no chance of such activity. For the broker the effort will be minimal, however for the client the peace of mind will be significant.
Harpal Singh is managing director of BrokerConveyancing.co.uk