RBS Business Banking | Land banking scams

What is a land banking scam?

Land banking scams are where investors are led to believe they are investing in land that will significantly increase in value through:

• plots being in areas with high house prices
• government intention of a general increase in housing
• proximity to land that has been allocated for development

In reality investors are sold land which:

• has no/very little development potential
• is very unlikely to be granted planning permission in the foreseeable future
• does not exist
• does not belong to the seller
• Like many investment frauds – such as boiler room fraud - the sale often takes place through high-pressured telephone calls, although it can also be through mailings, brochure distribution or websites. 

What to consider when buying land?

When purchasing land it is advisable to:
• Contact the appropriate council, depending on the geographical location of the land, to check who actually owns the land according to the Land Registry
• Check if the land has planning permission or is likely to get it in the future
• Seek independent legal advice 

Sources for further information

FSA’s Description of Land Banking Scams www.fsa.gov.uk
ActionFraud’s Website for Reporting Fraud and Internet crime www.actionfraud.police.uk
National Fraud Intelligence Bureau www.nfib.police.uk
Money Advice Service on Scams www.moneyadviceservice.org.uk/en/categories/scams-and-identity-theft
Land Registry www.landregistry.gov.uk

Set Tab for lightbox