How fraudulent land transfers take place

PUTTING himself in the shoes of a fraudster, National House Buyers Association (HBA) honorary secretary-general Chang Kim Loong reckons there are many parties involved in fraudulent land transfers.

“There is a lot of work to be done, but it is not something that is impossible,” said Chang, adding that there was a lot of monetary gain for the fraudsters.
Very likely, involved parties would include the related parties (vendor and buyers) and their respective lawyers, the land office, the land valuation department and the stamping office. And usually these transfers take a very short time.
“When the transaction takes two to three weeks, there is something fishy,” he said adding that a “conservative” transaction would take anything from six to nine months.
Chang says that usually idle land owned by foreigners or senior citizens is targeted. The fraudsters would find out details of a plot of land from the land office and survey department.
The fraudsters then either forge the title deed or get a replacement by pretending to be the owner of the land.
They would conveniently lodge a police report. The land office would then need the police report sworn with a statutory declaration and pay a requisite fee (about RM300) for the replacement title deed, which usually takes four to six months to obtain after the requisite gazetting.
Once the deed is obtained, the land is ready to be sold.
“You should be suspicious if it is a cash only deal or the land is being sold below value,” said Chang. If a bank loan is taken to finance the purchase, the bank's lawyers will also conduct relevant searches to determine the vendor is not a bankrupt as well as a valuation report on that landed property.
“When it is time to present to the land office registration, the lawyers do another search to ensure that no documents prohibiting the dealings such as a caveat or a prohibitory order,” said Chang.
When it comes to selling the land, all that is needed is the seller's and buyer's identity cards, the original copy of the Grant/ title deed, up-to-date quit rent bills and assessment receipts, which have to be provided by the seller.
Certified true quit rent receipts can be obtained from the land office for a fee of RM10. Before the final purchase, the stamping office sends the Memorandum of Transfer (MOT) to the nearest valuation department which adjudicates the value of the property and imposes the stamp duty, which is to be paid to the stamping office.
The last item is paying the requisite registration fee to the land office after the buyer shows proof of a paid stamping fee.
“With so many cases being lodged, the prosecution and investigators should be able to work out the modus operandi of the fraudsters,” said Chang adding that he was disappointed with the number of arrests made pertaining to the cases.

By RASHVINJEET S. BEDI -the star 23rd Dec 2007