Property Investment Fraud – How to Protect Yourself & What to Do If You Have Lost Money
The UK property market has grown in recent years, creating more opportunities for investors, but also making it an increasingly attractive target for fraudsters seeking to exploit unsuspecting investors.
In this article, we will discuss the following information:
What Counts as a Property Investment
Red Flags of Property Investment Fraud
How to Protect Yourself When Investing
How to Recover Your Funds If You Have Been a Victim
What Is Property Investment Fraud & Why It Matters to Investors
Property fraud can occur in a variety of ways, with fraudsters often using convincing and complex stories to persuade victims to transfer money. A large number of these cases are classified as Authorised Push Payment (APP) fraud.
APP fraud is when a scammer manipulates you into sending them money. You authorise the payment, but only because you were deceived. This is important because once you approve the payment, it can be harder to get your money back than if the transactions were unauthorised.
Common Examples of APP Fraud in Property Can Be Seen As:
Social Housing Investments
Fraudsters can claim they have contracts with official authorities such as the Government or Local Authorities. These contracts can be faked or exaggerated to trick investors into sending funds for supposedly large and guaranteed returns. You can read more about Social Housing scams and specific cases such as CityGate Housing & Social Housing Holdings on our website.
Off-Plan Property Scams / Real Estate Development
This is a common scam we see, and fraudsters lure investors into sending funds with the premise of earning large returns once the development has been completed. We usually see the development/company running into financial problems, and excuses are made as to why the development is not completed.
Fake Property Investments
Scammers advertise properties that either don’t exist or aren’t actually for sale. They can use cloned listings and pressure you to send upfront fees. Once you send the funds, they usually disappear, and the funds are gone.
Property “Flipping” Scams
Fraudsters utilise this tactic by buying properties for cheap and then selling at a higher, inflated price that does not match the actual value of the property.
Timeshare Resale Scams
Scammers target individuals who own timeshares and claim they can sell your timeshare. They ask for upfront and admin fees in order to process the sale. The BBC reported on a large-scale timeshare scam that affected more than 500 victims in the UK recently.
Title Deed / Ownership Fraud
The scammers impersonate property owners and sell victims a property that is not theirs. When the victim tries to register the property, they find the property is not owned by the individual they purchased it from.
This list highlights common property scams we at Refundee regularly encounter; however, it is important to note that fraudsters are highly sophisticated and can adapt property investment scams in many different ways.
Red Flags of Property Investment Fraud:
Although the scams can differ in how they operate, there are some common red flags that you can look out for before investing:
Pressure to act quickly
Unsolicited offers (calls, emails, social media)
Requests for upfront fees
Complicated ownership structures
Deals that sound unusually profitable
Lack of transparency around contracts or agreements
Unrealistic guaranteed returns
Unregulated firms
What Checks Can You Do Before Investing?
Verify the property - Check the listing independently on platforms like Rightmove to confirm it exists and matches the description.
Confirm legal ownership - Ask for the specific address, and to check ownership, you can use HM Land Registry, which is the official register of property ownership in England and Wales.
Vet the company or developer - Look them up on Companies House to confirm they’re legitimate and active.
Question guaranteed returns - Treat any “fixed” or unusually high returns as a strong warning sign of potential fraud.
Ask for proof of contracts - Request official proof of any contracts they claim to have with the Government or local authorities
Check online - You can carry out basic checks on independent review platforms such as Trustpilot and use Google to search for customer complaints or negative feedback about the company.
These are basic checks you can do before investing. It is important to conduct your due diligence before investing, and if something sounds too good to be true, it usually is.
How to Recover Your Funds from Property Investment Fraud:
If you have invested funds into property and it has turned out to be fraudulent, you may be eligible to recover your funds.
If you sent the funds from a UK bank account, you may be protected. New reimbursement rules for APP fraud in the UK have significantly improved victims’ chances of recovering lost funds.
Fraud victims in the UK have certain protections when they have been the victim of fraud. Depending on when the payment was made and what bank it was from, you may be able to recover your funds through the Contingent Reimbursement Model (CRM Code) or the Mandatory Reimbursement Model.
Can Refundee Help Me Recover My Funds?
We are experts within fraud recovery, and to date, we have recovered over £130 million for our clients so far, with a large proportion coming from property investment fraud.
We work on a no-win, no-fee basis, so you don’t pay anything up front, only when we are successful in recovering your funds.
Even if you are unsure if you are the victim of fraud and just concerned about your investment, our experts can guide you through the best next steps.
You can read more about our clients' experiences through our verified TrustPilot reviews.
You don’t need to seek professional representation to argue your case. You have the right to represent yourself for free. Of course, this means that you don’t incur a fee if you are successful.
How Refundee Helps Property Scam Victims
With Refundee, you get:
A free, no obligation case review
Clear guidance on your rights and whether you are eligible to claim
Help challenging refund refusals and escalating complaints
No win, no fee support - you only pay if your claim is successful
Final Thoughts:
Property investment can be a legitimate way to generate returns, but it also comes with significant risks, especially as fraudsters become more sophisticated in targeting investors.
Taking the time to carry out proper checks, verify information and questioning anything that feels rushed or overly profitable can help you avoid costly mistakes.
If you have already been affected, it’s important to act quickly, report the fraud to your bank, and explore your options for recovery under the UK’s reimbursement rules.
