Avoid fraud in title transfers
Whether you’re buying a property to live in or rent out, the transfer of the land title is a critical step – and one that’s open to corruption by fraudsters.
The land title is the official record of who owns the land and often includes information about mortgages, covenants, caveats and easements. Each state and territory has a central register of all land in the state and details the owner of the land.
Whenever land changes hands, the certificate of title is updated.
Unfortunately, while titles are being updated, criminal and unscrupulous dealers can intervene with devastating effect.
The most common crime involves identity theft, where the fraudster assumes the identity of the land owner and offers the land as security for a loan or sells it to a third party.
Verifying the identity of the person claiming to be the owner of a property, who has the authority to sell that property, is critical during the land transaction process.
When buying, selling or transferring property, there are requirements that help protect parties from land title fraud. For example, State laws require all involved in a conveyancing transaction to have their identity verified before settlement can occur.
To further reduce the risk of land title fraud, some state authorities have introduced verification of identity (VOI) policies. VOI is a higher standard of identity verification that requires conveyancers and other property professionals (like mortgagors) to take “reasonable steps” to verify their client’s identity and confirm their clients’ authority to deal with a particular property.
Mandatory VOI policies are currently in place in Victoria, South Australia and Western Australia, and will be introduced in New South Wales later this year.
VOI requirements include face-to-face identity checks (together with in-person interview), which include the verification of original and up-to-date proof of identity.
Buyers, sellers and agents can also check out the fraud prevention services offered in their state or territory by visiting the respective land titles office website