CAB investigates "builder bailout" fraud.

[yehbut_nobut]

Came across this on propertypin.ie, from a news item on RTE -

The Criminal Assets Bureau has discovered a new form of fraud that has become popular since the recession started, the Oireachtas Finance Committee has been told.


Detective Chief Superintendent John O'Mahony said the CAB calls this the 'builder bailout' fraud.


He said the fraud involves creating a false identity for a person, who then gets a mortgage on one of the builder's properties.


The result is the builder gets paid for a property, which he had been unable to sell and the accomplice gets a percentage of the deal.
He said criminals had also used mortgages as a way of hiding the proceeds of crime.


Criminals would repay a loan with large cash lodgements before selling the property and the price they got appeared to be what he called clean money.

I wonder how widespread this is, and who's been involved. Still not clear to me exactly who ends up being "suckered" in this one...(apart from law abiding public of course!)

[perprojustice]

Well you have got to admire their cunning.
How they expected to get away with it is another question. It was bound to be twigged if and when the payments stopped.

[cunningstunt]

The bank or building society would get an order for possession 6/9 months later and would then own a property of dubious value. The builder wins and the "mortgage applicant" wins and the public who have guaranteed the banks loses again.

[Odyessus]

Came across this on propertypin.ie, from a news item on RTE -



I wonder how widespread this is, and who's been involved. Still not clear to me exactly who ends up being "suckered" in this one...(apart from law abiding public of course!)

Can anyone translate this gibberish into English, or are we supposed to guess what the scam is and how it works?


P.S. I refer to the RTE site quoted.

[stewiegriffin]

Seems straight forward really . Mr X gets a mortage(with no intention of paying it back)
Mr builder pockets the money . The bank takes Mr Xs house back and Mr X gets a few bob for his trouble .

Oh right , just saw your edit*

[perprojustice]

The bank or building society would get an order for possession 6/9 months later and would then own a property of dubious value. The builder wins and the "mortgage applicant" wins and the public who have guaranteed the banks loses again.

Having reread the rte report it is very clear that what is allegedly happening is that it is a money laundering scam. The mortgage is paid off in a lump sum the criminal then has his clean money from the resale of the house.

I cannot see the first scenario working as the builder is bound to be implicated in it, unless he is using a foreign national who will be far away and uncontactable by the time it is twigged.

[Odyessus]

Having reread the rte report it is very clear that what is allegedly happening is that it is a money laundering scam. The mortgage is paid off in a lump sum the criminal then has his clean money from the resale of the house.

I cannot see the first scenario working as the builder is bound to be implicated in it, unless he is using a foreign national who will be far away and uncontactable by the time it is twigged.

If it was very clear, we wouldn't be debating what it means.

[perprojustice]

If it was very clear, we wouldn't be debating what it means.

You are the one with the problem; I do not see any problem. It is quite clear to me.But then

[Arabella]

its pretty ingenious alright - particulary if the idenity fraud is done well enough in the first place then it would be very hard to prove anything.

although am i wrong in thinking that this has been a used method of money laundrying for some time...i'll go see if i can find a link...maybe i'm imagining it...?

[candi]

its pretty ingenious alright - particulary if the idenity fraud is done well enough in the first place then it would be very hard to prove anything.

although am i wrong in thinking that this has been a used method of money laundrying for some time...i'll go see if i can find a link...maybe i'm imagining it...?

You can be sure that in these recessionary times all the old schemes and scams will be reintroduced with a bit of tweaking to overcome modern technology