Agent helped to thwart a potential scam

A warning was recently issued by the Real Estate Institute of Western Australia and the Australian Institute of Conveyancers in WA regarding potential investment fraud victims who had been making cash offers on multiple properties in Perth.

Consumer Protection has highlighted a Secret Harbour real estate agent’s vigilance in identifying a problem with the finance that two women had supposedly obtained from an American institution to make several cash property purchases possible.

The agent first became suspicious because of the high number of cash offers made. The agent then requested documentation to support the buyers’ financial position. The documentation provided raised the agent’s suspicions further and the agent contacted WA ScamNet.

WA ScamNet, in conjunction with the Western Australian Police (WAPOL) Major Fraud Squad (MFS) was able to identify the loan documents as bogus and inform the affected parties in order to cease the scam’s progress.

The potential property buyers told MFS Detectives that they were under the belief that they would receive finance for $10million from a US-based financial entity, to support philanthropic enterprises, such as the rehousing of homeless people. This, they said, was the reason for their proposed purchase of numerous properties south of Perth.

Signs which may assist agents to identify fraudulent activity include the:

• transaction involves people residing in, and documents issued from overseas, especially countries known for scams;
• email addresses being used are generic, such as yahoo or gmail, when you would expect them to be more professional considering the entity involved e.g. financial institution, lawyer etc.;
• communication is in a style which is not normally associated with the person or profession:
• use of poor English;
• language and style within professional communications and documents are unnaturally informal;
• quality of document is substandard; and
• information is inconsistent throughout document.

If doubts are raised about the authenticity of a document, agents could seek to have it independently verified by the issuing authority. Agents could also consider contacting the WAPOL Major Fraud Squad (08 9220 0700) or WA ScamNet at Consumer Protection (1300 30 40 54) for advice.

Acting Commissioner for Consumer Protection Gary Newcombe said: “In this instance, the agent’s vigilance is an example of the important role agents play in the protection of property buyers and sellers from fraudulent activity. It is an important reminder of the need for real estate agencies to apply rigorous scrutiny to all potential property transactions.”