Buy to Let You've Been Scammed

Millions of us are targeted in scams every year,

and whether it comes in the form of an e-mail,

a cold call or knock at the door, they are all designed to do

one thing and one thing only - to get you to part with your cash.

Coming up, the elaborate scam designed to get people to hand over their PIN numbers.

I felt like a complete idiot.

I thought, "I've done exactly what the bank warn you not to do."

Plus, I meet a man who was drawn into a property scam that left him in dire straits.

I will be liable for the shortfall,

and that will maybe mean I lose my own home.

Chip and PIN - a system devised to make credit and debit card fraud harder,

and in the most part it's been very successful.

That hasn't stopped the con men from trying.

And in 2010, a pair of fraudsters devised

an elaborate con to get hold of people's bank cards and PIN numbers.

Their scam was targeted largely at pensioners

and they managed to steal over £100,000.

In a number of cases, they had illnesses and disabilities.

The loss of esteem with the money had really severe effects on a number of the victims.

The investigation into these con men began in January 2011,

when complaints began flooding in to Kent police.

We were receiving complaints, in some areas as many as two or three in a day.

People were saying that money was being stolen from their bank accounts,

and there seemed to be a clear pattern connecting the cases.

The victims would receive a call from a male.

He would speak to them by name. He was in a position to identify what their bank was,

and he would basically bring them on board by saying that he was a police officer,

he was from a fraud squad, and that they were investigating

the victim's credit card or account, which had been compromised.

-62-year-old pensioner Patricia Harris...

-Hello?

..was woken by one such call.

They phoned early in the morning and said they were the police

and that they had good news and bad news.

The bad news was someone had tried to use my card on the Internet,

but the good news was it had been picked up.

Well, I thought I was lucky that, you know,

whatever it was hadn't gone through and I hadn't lost money.

The fraudster's authoritative patter convinced Patricia

she was talking to a genuine police officer.

100% believed them, because they were so confident,

and they did actually sound like the police, you know?

They said all the right things.

Realising they had Patricia hooked, they then began an onslaught of phone calls.

They kept ringing and asking more and more questions

about where I used the card, what was the last time I used the card.

They rang so often it'd almost become like speaking to a friend.

Bombarding their victims with phone calls was a deliberate and calculated tactic.

It let the offenders know the victim's state of mind, effectively.

It also allowed them to keep exerting a level of pressure against the victim by saying,

"You mustn't contact your bank, you mustn't speak to a member of your family."

The barrage of calls left Patricia scared and confused, and sensing the moment was right,

the fraudsters told Patricia they would need to collect her card and PIN number.

They said they would send an officer round with a code word.

And to have the card ready in an envelope,

and to write the PIN number on the envelope, and of course, I did.

Patricia waited, envelope in hand, for one of the con men to arrive.

A chap turned up at the door in a plain dark suit,

very well-dressed, actually.

He said the code word, and then he showed me his identification.

It looked unbelievably real.

But the man claiming to be a police officer was, of course, nothing of the sort,

and as soon as he'd collected Patricia's card,

he went to a cash machine and withdrew £400.

But Patricia had smelled a rat.

After the card had been collected, erm, I don't know.

Something didn't seem quite right. I started to get anxious.

And I phoned the bank and they said,

"No, we'll put a stop on the card immediately."

Patricia's quick thinking meant no more money could be taken from her account.

But the fraudsters were soon back on the phone.

20 minutes after I cancelled the card, I got yet another call from the original chap,

and I said, "No, I've stopped the card."

So he said, "Why?"

I said, "Because I suddenly realised I don't think you are the police, and I don't think this is genuine."

And in this amazed tone, he said, "Well, you've spoiled everything now."

I said, "Good. And don't phone me again."

I felt like a complete idiot.

I thought, "I've done exactly what the bank warn you not to do.

"I've told someone my PIN number, I've given my card away to a complete stranger."

And more than anything, I felt a fool.

But Patricia wasn't alone.

Scores of other pensioners had handed over their cards in exactly the same way,

and Detective Constable Don Share was now on the trail of the men behind this scam.

I had a number of identities made as regards the person who had come to the victims' door,

and there was no consistency there. It was different identifications made, different descriptions.

There was no vehicles, it was quite a low starting point to work from.

But there was one lead. The con men had used pre-pay mobile phones to contact their victims.

Pre-pay mobile phones are a tool that is used increasingly by criminals.

It's a way of distancing themselves from a particular mobile

in the hope that if they use that in an offence, it can't be tracked back to them.

But it's a big mistake. Once you've hit dial on a mobile, you're on the grid.

Mobile phones leave a network imprint, effectively a footprint.

Wherever that phone is used to make an outgoing call or an ingoing call, it registers the area.

That data narrowed down the places where the criminals were making their calls,

but DC Share needed more to go on.

We had already looked at some of the travel patterns for the mobiles that were being used.

It was clear they were travelling down the key motorways, effectively,

into Kent from the London area.

Because of where these offences were occurring,

it was clear that a vehicle was the key means of travel.

If they could locate this vehicle, they would find the fraudsters.

Within Kent, we've invested heavily in technology

which has seen our key main roads covered by a system of cameras.

It's a tool that's called automatic numberplate reading.

The team set about cross referencing information captured by these cameras

with the locations where the phones and the cards had been used.

I'd spent upwards of a week just reviewing data of the offences

and comparing vehicles that may be in one area against vehicles in another area.

Soul-destroying work to do, and time-consuming.

Good, old-fashioned police work - it finally paid off.

We were able to identify one particular vehicle

that was in the Maidstone area on a key date of an offence,

and when we searched that vehicle against data for the Gravesend area,

it was also in that area on the time of a key offence.

So, they now had the car, but just who was driving?

We made a number of background checks to establish who potentially

was using that vehicle, and that name was Oscar Uebowa.

Eastender Oscar Uebowa was 27 years old,

and what they discovered about his lifestyle was a revelation.

We had found out he was living in some very expensive apartments.

He had also a penchant for renting high-value, top-end vehicles.

We built up this picture of this person who was leading a high life

but had no demonstratable form of job that was supporting that high life.

He was living well beyond his means.

The police were confident that he was their man,

but just as soon as they had Uebowa in their sights, he disappeared.

We were doing a series of warrants to try and locate and arrest Uebowa

when we found mail for Uebowa was being addressed to an east London address.

That address was home to Uebowa's accomplice,

26-year-old Jonathan Minter, and he was arrested.

But Uebowa remained at large.

We found him one morning leaving his mother's address in east London.

An officer approached him, spoke to him,

and Uebowa made that conscious decision at that time to try and flee.

He battered his way out, knocked the police car out of the way,

and drove off at high speed before ultimately

crashing in a head-on collision with another vehicle.

Uebowa was unhurt and was arrested

and charged with conspiracy to commit fraud by false representation.

He pleaded guilty and on the 30th of April, 2012, was sentenced to four years in prison.

His accomplice, Jonathan Minter, initially claimed he was innocent

but later pleaded guilty and was sent down for five years.

The two of them had stolen over £100,000 from 27 victims,

most of whom were aged 80 or over.

I, personally, was extremely annoyed, as most people would be, to see

the level of offending that had taken place.

It's very pleasing to see that these individuals were ultimately convicted and are now serving sentence for it.

When the property market boomed,

so did the market for buy-to-let investments,

and for a lot of people, they turned out to be a great way to boost their savings.

But unfortunately, that hasn't been the case for all.

Over the last decade, con men have come up with a range of

buy-to-let scams that have targeted our desire to invest in property.

In this country, we love bricks and mortar, we always have done.

It's always been seen as a safe investment.

In most of these scams, con men promise high quality properties

with guaranteed rental incomes.

But when people have handed over their cash,

they discover they've been sold a derelict house or one in an area where no-one wants to rent.

The fundamental thing is,

it's all about selling property at over the odds, at inflated prices.

And sadly, these scams have succeeded in taking millions of pounds

from honest and hard working people.

I'm off to meet a man who invested in buy-to-let property,

hoping that it would give him long-term security.

Sadly, the opposite is true.

68-year-old Alan is retired and lives near Swindon.

In 2007, he was drawn into a buy-to-let scam,

and as a result now faces the very real prospect of losing his own home.

-Hello, Alan.

-Hello, Matt.

-How are you doing, all right?

-Nice to see you.

-Shall I come in?

-Come in.

'For years, Alan worked for export companies in the city, where

'he handled multi-million pound contracts

'and dealt with complex shipping arrangements.'

What was it about you that made you good at that job?

I had attention to detail, as far as documentation and the financial arrangements were concerned.

That's what I was particularly known for.

So, when it came to fine detail, Alan is your go to.

Well, I was one of those. That was my particular feature, I suppose, yes.

Alan left his city job after going through a divorce,

and has since tried his hand at door to door sales and running a shop.

But with retirement fast approaching, Alan needed to find a way to secure his financial future.

I'd been to one or two seminars, the type of get-rich-quick type of meetings,

which I always am fairly dubious about.

But then a buy-to-let investment company made Alan sit up and take notice.

They were sending daily e-mail offerings with highly detailed brochures.

One or two caught my eye, and the figures they were giving seemed to be fairly realistic.

The initial phase of this fraud has to be marketing.

You've got to get people interested in it.

The easiest way of doing that is by having a very, very professional e-mail sent out.

Alan was curious, and decided to contact the company for more information.

Once you respond to this, they then bring in a highly trained, very skilled sales team.

The sales rep told Alan they could offer him

substantial discounts on brand new properties.

This company were claiming 15%, maybe 16%, 17.5% discount.

And that could easily mean a discount of £15,000 to £20,000. Not bad.

Even better, the company told Alan they had a legitimate scheme

that meant he could use this discount as the deposit on his mortgage.

All he had to do to take advantage of this scheme was attend

the company's seminar, at a cost of just under £2,800.

Alan signed up, and was impressed by what he saw.

They were not high-pressure or pushy,

they seemed to be fairly low key.

They seemed to be not attempting to deceive people.

They will portray themselves as very professional, very used to dealing in property,

and they will tell you that they will deal with it all.

Of the many properties the company was offering,

it was a new build in the Country Durham town of Bishop Auckland that caught Alan's attention.

Can you tell me what it was that made it stand out from all the others you'd seen?

The nature of the property, which was a detached house, the price,

and the general description of the amenities of the area.

With its proximity to the town centre

and a train station, the property seemed to be in a prime location,

and Alan was told it would bring in almost £700 per month in rent.

How did you go about checking those figures?

They would have given the names of certain estate agents locally to check the rental figures.

Alan now suspects the agents who confirmed these figures were part of the scam,

but at the time he had no reason to doubt them, and was eager to go ahead and purchase the property.

But to proceed, Alan would have to cough up yet more cash, a £1,000 reservation fee

and a finder's fee of almost £6,000.

Fraudsters are in this to make money.

They will try and extract as much money as they possibly can.

They will push it to the limit.

Having shelled out another seven grand in fees,

Alan was finally allowed to view the property.

But when he arrived in Country Durham, he was in for a shock.

The house wasn't in the town of Bishop Auckland at all.

It was in a small village 12 miles away.

Describe to me what you felt when you walked up

and saw the property itself.

It was a bit remote, shall we say. It was not a place with facilities.

It was surrounded by sheep, and a wind farm, which was very unsightly.

So, when he said to them, "Hold on a second,

"this is not the property I thought I was buying", what did they say?

Well, they obviously tried to gloss over it,

and that was just a mistake on the map.

But it was no mistake.

It seemed the company had deliberately lied

about the location of the property to get Alan to hand over the fees.

Once you've paid £7,000 for the idea, the process of buying the house,

-it's incredibly difficult to then step back.

-That's right, yes.

Alan was worried the remote location would mean the rental income

would be much lower than the £700 a month he'd been promised.

But the smooth-talking salesmen assured him he needn't worry.

Despite its location, I did have assurances from rental agents

that the projected rental values could be met.

Reassured, Alan decided to go ahead.

The house was on the market for £156,000 pounds,

but with the company's discount, he'd only have to pay £137,000.

All he had to do now was apply for the mortgage,

and the company told Alan not to worry - they would take care of that for him.

When it came to them organising paperwork for you,

mortgage forms, things like that, how were they?

They were acting through other people.

They were tending to gloss over things without too much attention to the detail.

Even though I didn't know exactly what they'd written down on the form,

and they filled them in for me over the telephone,

-I still was a little bit uneasy.

-You were uncomfortable with that?

Deep down, I felt uneasy and uncomfortable,

but overriding that to some extent was an ambition

to get involved with what may have been a good long-term investment.

The fraudster needs to control the mortgage application,

because they may have to lie within it.

They may have to inflate your salary.

So it is essential that they control everything.

All they want is your signature and you to obtain that mortgage so they can offload their property.

Alan's mortgage application was submitted, but unbeknown to him, parts of it had been doctored,

including his income, which had been doubled.

Unsurprisingly, the mortgage was approved,

and Alan soon had the keys to his new house.

Can you described to me the feelings that you were going through

at the point where you were making these deals?

Glad that I was able to obtain the finance for these, I was pretty pleased about that.

And this detached house seemed to me almost a luxury I could afford.

Now the company had their claws into Alan,

he was quickly persuaded to invest in more properties.

I felt, I suppose subconsciously, that more than one would be

necessary to make a difference financially.

The company was quick to help Alan invest in two more buy-to-let properties,

one in Manchester and one in Sheffield.

And again, the company controlled every aspect of the deal.

But Alan was about to get his first indication that things weren't right.

Let's talk about the moment when you started to realise that

things weren't stacking up with the properties that you had bought.

It was really this first property.

It took me eight months to find a tenant, and that

was at a rent about £200 less than I was originally hoping for.

It was causing me extreme financial problems.

Alan was having to stump up the monthly shortfall between the rent and the mortgage.

And it was the same story with the flats in Manchester and Sheffield.

So what had happened to the rental incomes the company had promised?

Alan needed answers.

I phoned them up and occasionally I called on them to try

and find me rentals that they had promised were achievable.

After a while, they themselves seemed to stop answering me,

as if they were not in fact genuine agents at all.

Alan was now shelling out hundreds of pounds a month to cover

the mortgages on his three buy-to-lets,

and as a result he was struggling to meet payments on his own home.

The worst scenario for this is that you cannot sell the properties that you've invested in,

you cannot cover the mortgage.

The houses get repossessed, you lose money everywhere in that,

and, actually, you become bankrupt.

Alan had to act fast to save his own home.

He needed to shift these buy-to-lets as soon as possible,

but any hope of selling them on were dashed when he discovered

all three properties were worth far less than he'd paid.

The properties had been hugely overvalued,

and combined with a fall in property prices, Alan was now deep in

negative equity, with the sickening realization he'd been duped.

Can you explain to me the moment where you finally realised

that what you'd been involved in was mis-selling, was a scam?

Well, when I got no answers from the company.

The property company had dropped off the radar,

and when Alan did some research, he realized he wasn't alone.

I saw certain postings on the Internet concerning this particular company,

where they hadn't paid back people's deposits,

and where they had sold properties in Spain which weren't there.

When you saw that on the Internet, what went through your mind?

I was very annoyed, but I felt that maybe other people had

perhaps suffered more from them than I had.

That was really confirmation to me when I was contacted by the North Yorkshire Serious Fraud Squad.

After receiving multiple complaints, the police hunted down and investigated

the directors of the company.

It turned out they were also involved in another buy-to-let fraud,

and it was for this crime they were finally convicted.

That's of little consolation to Alan, who has been saddled with

three properties that he can't afford to keep, and can't sell.

-What's your financial situation now?

-'It's not good at all.

'Instead of being able to perhaps hope that the increased

values of the properties could cover the purchase of my own home,

there are now massive shortfalls that are deeply in negative equity.

There is absolutely no way I can get a remortgage in my current financial situation and age,

so I will be liable for the shortfall,

and that will maybe mean I lose my own home.

I feel terrible for you.

Your house here, which is the product of your hard work

-over many, many years, of decades, and now this is at risk.

-Yes.

Because of a scam.

So, if you're thinking of investing in buy-to-let property,

here are some tips to avoid being scammed.

Do not use the people that they provide for you.

Use your own solicitor.

Don't get hoodwinked into using their people.

Make your own enquiries before ever signing any of this.

And finally...

Go to independent estate agents,

ask what is the going rate for rental in that area,

ask what the current market value

for that property is before you commit to this.

What a nightmare.

The very scheme that was supposed to secure Alan's house has now put that house at risk,

and all because the checks and balances that the methodical Alan should have done

went out the window when he thought he'd miss out.

Now, before we go, there's just time to tell you

about some of the latest scams out there.

I've come to meet an expert from the Financial Services Authority

to get the low-down on what you should be looking out for.

Today, we're looking at a boiler room scam where con men clone

the identity of a legitimate investment firm.

So, how does that cloning work?

A few years back, people who were running these cons used to

just pick a plausible sounding name and tell you that they

worked for that company, and then they'd change their name every so often.

That stopped working as the public got much better at working out

what a scam is, so they started checking out the FSA's register

to see whether the firm's authorised by the Financial Services Authority.

And now that people are good at doing that, the firms found that

the only way they can scam people is to use names of real, legitimate registered companies.

OK, that sounds quite difficult to defend yourself against,

because if they look and sound like a company that you recognise already,

how do you know that they aren't?

Well, that is the clever but awful bit by the investment scammers,

because they will go as far as ripping off a website.

They will take an electronic image of the real firm's website,

create their own website, and the only difference is the telephone number.

And they'll put their own telephone number on it,

so that's the clue for the savvy investor -

work out the switchboard number of the real, legitimate firm,

and use that as your contact number, and then you know that you are dealing with the real firm.

There are several ways to find the proper phone number

for an investment firm, including a check of the FSA's website.

And as always, be very wary of cold callers.

Fraudsters will be forever coming up with new ways to get you

to part with your cash, but armed with a little bit of knowledge, you can be one step ahead of them.

Stay safe, and I'll see you next time.

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