Fraud has cost the UK private real estate sector £501m last year, contributing to losses from fraud of £73bn for the UK economy as a whole, according to government figures released today.
Large estate agents and developers employing more than 250 people lost £151m through fraud last year, while small to medium-sized real estate businesses were conned out of £350m.
Types of fraud include false signatures and illegitimate loans for deals.
It is the first time that activity in the property sector has been examined in the National Fraud Agency’s annual fraud indicator.
In total, the private sector, which also accounts for the construction sector, experienced £45.5bn losses, and combined with public sector losses, fraud cost the UK £73bn – a sharp hike on the £38bn recorded in 2010.
In the public sector, housing tenancy fraud totalled £900m last year, and private rental property fraud – in which tenants are deceived into paying for a non-existent building – totalled £488m.
Stephen Harrison, chief executive of the NFA, said: “The report raises awareness of the scale of fraud and illustrates to organisations their likely exposure. It provides a spur to develop effective solutions by ‘tapping in’ to the good practice developed in other sectors.”
joanna.bourke@estatesgazette.com
