Latest news & updates.

When the term’ theft’ does no justice to the act of identity theft?

When the term’ theft’ does no justice to the act of identity theft?

As a professional investigative business working with closely with the legal and financial industry, the scenario this article details is of significant interest. However, it also gives us cause for concern. No doubt, due to the nature of your profession, you will be interested in what it highlights – indeed we feel it only responsible for us to ensure that you are all aware of this rather bizarre legal position.

Identity theft is nothing new; in a world dominated by the presence of the internet alongside the array of forms of electronic communication, it is arguably a type of theft that will unfortunately continue to thrive. Defined by the Cambridge Dictionary as: ‘the crime of using someone’s personal information in order to pretend to be them and to get money or goods in their name’ , it would appear on the face of it, that identity theft is a form of theft both in terms of using a person’s identity, as well as what it is then used for and that it is, therefore, clearly a crime. However, when we learnt about the following scenario, we were forced to take a step back to rethink our understanding of what identity theft is and how it is perceived by the authorities.

Real life scenario: reported recently that a man had stolen the identity of a couple who owned a property in West London which was for sale and successfully secured a short-term mortgage of £800,000 on it. The £800,000 was deposited by the mortgage lender into what appeared to be the bank account of a solicitor’s firm apparently acting on behalf of the man. However, the name of the solicitor’s firm was very similar to the name of a legitimate solicitor’s firm and the man had lied by claiming that the firm had verified his false documentation.

It was only when the mortgage broker was unable to register a charge against the West London property that the fraud was discovered. The mortgage lender let Action Fraud know what had taken place and then turned to a private investigator to help them to locate the stolen money. However, the West London property owners who were the victims of this identity theft leading to the fraud, were unaware of what had happened.

And the man did not stop here. He attempted at least a further 11 more fraudulent actions using the stolen identity of the property owners as well as successfully physically entering the property in question through a property buying agent.

When an attempt was made by the man to gain a bridging loan of £500,000 from James Lennon, a mortgage broker of Tapton Capital, the mortgage broker contacted the property owners to alert them to identity theft. Naturally the property owners then alerted the police that their identity had been stolen.

Identity theft versus identity fraud

Upon revealing to the police that an identity theft had taken place, one would have anticipated that action would be taken against the man concerned and as a result he would no longer be able to attempt crimes using the stolen identity. However, it seems not. According to Action Fraud, the act of stealing another person’s identity is not an act which the police record. It is only the result of the identity theft in terms of the crime carried out through the use of the stolen identity which can be recorded. As Action Fraud states: ‘Identity theft is when your personal details are stolen and identity fraud is when those details are used to commit fraud’. As a result, the identity theft from the couple who owned the West London property is simply a piece of the puzzle of the crimes which took place or were attempted.

So whilst it may appear that the couple are victims of crime, in terms of the act of identity theft alone, they are not. The couple will only be considered victims of criminal activity once a financial loss appears to have occurred as a result of the identity theft which in this case the mortgage lender who had lent the £800,000 had instead asked a private investigator to look into it . Yet despite this, ironically, Action Fraud states: ‘Criminals commit identity theft by stealing your personal information’ – a reasonable person would surely be forgiven for thinking with the use of the terms ‘commit’ and ‘stealing’ in this context that the identity theft alone is still a crime which the person whose identity has been stolen is a victim of…

More alarm bells ring

A further case for concern in terms of this scenario is the man’s ability to use a legitimate law firm to validate the stolen identity. Apparently, the man successfully impersonated a solicitor within the firm and as a result, successfully opened a bank account using the name of the law firm. No doubt, the ease of which the man appears to have done this sends shivers down the spine of many solicitors out there.

In addition to the above, it is concerning that the man was able to enter the couple’s property which is where he managed to steal their identity. Yet, despite this, the property firm which the man used as a tool to do so where he claimed to represent a legitimate buying agency, says that it complied with GDPR rules. It is certainly worrying to think that rules in place to protect the identity of the public did not suffice in this instance.

This scenario has revealed the potential for serious crime to take place many times through one instance of stolen identity. If identity theft was considered enough in itself to constitute a recordable crime, the multiple attempts of serious crime could have been stopped from taking place. In this light, it certainly seems absurd that identity theft alone cannot be a recordable crime. In the wider scheme of things this would potentially be a way to reduce the prospect of more serious crime from occurring, therefore, protecting others from becoming the victims of crime as well protecting those who have their identity stolen in the first place.

This scenario will hopefully cause us to be extra vigilant in terms of the potential amount of crime which can take place as a result of one identity theft and will no doubt linger in the back of our minds when we carry out the legal and financial work required of our professions.


Estate agent caught up in £800,000 mortgage fraud case

About The Author

Mark Hodgson is the Managing Director of Tremark Associates, one of the UK’s leading providers of investigative services. Mark formed Tremark aged just 25 in 1995 and has over 30 years experience in private investigations and commercial debt recovery industries. He is a leading figure and a campaigner for regulation of the Industry and past President of the Association of British Investigators, a member of the World Association of Detectives, The Chartered Institute of Credit Management, The Institute of Paralegals and an associate member of R3 -The Association of Business Recovery Professionals. Mark splits his time between the Leeds and London Offices. He is a dad of two, a keen runner, cyclist and a Leeds United season ticket holder.