The BBC dedicated a segment of its fraud awareness programme ‘You’ve Been Scammed’ last week what it described as a “truly audacious scam” whereby two fraudsters attempted to dupe bridging finance company Masthaven into handing over £1.5m.
In March 2010, an independent mortgage broker contacted bridging lender Masthaven, claiming to represent two wealthy Middle-Eastern brothers who were looking to take out the loan on a luxury flat in Bayswater.
The pair provided both proof of ownership for the property and passports verifying their given identities. Masthaven were even able to carry out a valuation on the property without suspicions being raised.
The scammers stumbled when they ran into an unexpected policy of Masthaven where clients who are asking to borrow over £1m are required to come into the offices for a face-to-face meeting.
Shortly after hearing of this policy, the broker informed Masthaven that they would only need to borrow £925,000 after all.
Suspicions suitably raised, Masthaven managing director Andrew Bloom checked the paperwork the pair had submitted, discovered discrepancies on the utility bills and decided to forward the information onto the City of London Police’s fraud department.
Fraud investigator DC Lizzie Roberts explained how quickly the details of the seemingly legitimate scheme fell apart after the police placed the men under careful scrutiny.
The passport used to verify proof of address was found to have been that of a dead child, altered to include a falsified address. What may have surprised people perhaps less familiar with the industry was the ease with which they managed to obtain the title deeds to the house while the owners were living in Dubai, blissfully unaware.
DC Roberts explained that anyone can apply for any title deeds anywhere in the UK and that some later research revealed the scammer had applied twice that year, once in January and once again in February.
Probably the most audacious part of the whole affair was how the scammers managed to get a valuer to come in without raising suspicions. Since the house was on the market, the fraudsters simply invited the valuer to come on the same day they had arranged a viewing.
When (quite reasonably) the person showing them around asked why there was a man with a tape measure inspecting the property, they explained they represented an Arab princess who was keen to get measurements for furniture.
With the scam laid bare, the police were faced with realisation they had no idea how to find the scammers. A sting operation was put into place involving 10 undercover police and the Marriott Hotel where Bloom pretended the deal would go ahead.
After the two men showed up in slightly unconvincing Arab dress, complete with “tea towels on their heads”, according to presenter Matt Allwright, the arrests were made.
Four men were charged with conspiracy to commit fraud and false representation and handed a total of 10 and a half years. One of the men, Shakil Ahmed, was sentenced to three years in absence after he failed to turn up for the court date. He has never been found.
As TV shows go it was certainly stimulating. But some of the details about how easy it was for the perpetrators to set up the fraud were simply staggering. If nothing else surely the moral of the story is that with things like title deeds more needs to be done to ensure fraudsters cannot take advantage.