For NDG (And Any Other Legal Eagles)

Generali

The very excellent ClitheroeKid posted the below:

http://boards.fool.co.uk/ive-just-emailed-the-editor-of-the-law-society-12391069.aspx

I've just emailed the Editor of the Law Society Gazette as follows:

I’m sure other solicitors will have become aware of land banking operations over the past few years. For those who aren’t it involves a company buying a plot of agricultural land, setting up a scheme to make it look as though it has development potential, and then selling at a huge premium `plots’ to gullible investors who are tricked into thinking the land might gain planning permission.

According to the latest government figures the victims of such schemes have been scammed out of around £200m. Some of the operators have gained a degree of apparent legitimacy by quoting the name of their solicitors in the marketing material, and the companies will almost invariably offer the services of their solicitor to register the victim’s title (which raises an interesting question of whether the victim thereby becomes a client of the firm with a possible cause of action against them).

As the government seem too supine to tackle the problem I would suggest that the SRA and the Council for Licensed Conveyancers make it a disciplinary offence to act for any individual or company that’s involved in such a scheme.

I've also written to the Solicitors Regulation Authotity and the Council for Licensed Conveyancers in similar terms. As a solicitor / conveyancer is almost always involved in these schemes taking them out of the process should make it a lot more difficult for the fraudsters to operate.

Of course whether these two august bodies are any less supine than the government remains to be seen. I'll report back with their response, but I'm not holding my breath.

It does seem very poor to me that solicitors are effectively using the good name of the industry to help hucksters market these scams or that scammers are using a solicitor's good name to claim legitimacy.

Perhaps some of you would be interested in making the time to send a similar email. Or not of course.

leveller2911

The link below is to a local area of land that was bought and split up into individual plots of about 0.125 acres about 20-25 years ago.

http://www.land-deals.co.uk/land.asp?Town=Hastings&County=East%20Sussex

At the time there was a big hoo ha as they were advertised far and wide with the discription of being development land with paragraphs salesmen speil about how the area was in dire need of housing(which it is) and how the Local Authority would need to find building plots.It made no mention of the area being classed by the planners as "an area of outstanding natural beauty" so the gullible all bought the plots which from around £8k-20k at the time.The true value of the land at the time was in the £hundreds.

Over the past 20 years or so every so often we see a planning application go in for a house to be built but needless to say they are rejected at the first hurdle.The truth is they will never get planning on the site within their lifetimes but I guess they see it as a gamble worth paying.

I suppose even sloicitors are human and at the end of the day they go to work to earn money ,its the same as the rest of us.

ILW

Solicitors just make sure that ownership is confirmed. Greedy individuals expecting something for nothing are their own worst enemies.

nearlynew

possibly the most boring thread you have ever started gen.


caveat emptor I say.

Generali

ILW wrote: »

Greedy individuals expecting something for nothing are their own worst enemies.

True, however if I buy into what I think is a good investment am I greedy or just looking for a decent rate of return?

These land banking schemes implicitly (and sometimes explicitly) lie to people to take their money.

ILW

Generali wrote: »

True, however if I buy into what I think is a good investment am I greedy or just looking for a decent rate of return?

These land banking schemes implicitly (and sometimes explicitly) lie to people to take their money.

I would suggest that if you are expecting the sort of return these schemes suggest (triple your investment in a couple of years) that is more than expecting a decent rate of return. It is a gamble.

Generali

nearlynew wrote: »

possibly the most boring thread you have ever started gen.


caveat emptor I say.

It's up against some competition! Surely some of the ones about the more technical bits of banking are duller...?

I agree with caveat emptor. There are limits to it and those include (ab)using the good name of a professional body.

michaels

Is it any worse a bet than buying a lottery ticket. Are there definitely no examples of such pieces of land ever being granted permission? How about the new 'presumption in favour of sustainable development'? Is there any secondary market in the plots?

Crash_Over

Generali wrote: »

These land banking schemes implicitly (and sometimes explicitly) lie to people to take their money.

You may have a point. Some of these schemes are marketed in places like India where the buyers believe they are buying into prime english real estate.

However, surely if those selling are blatantly lying or implying future planning permission is just a formality, wouldn't that be covered by existing legislation.

ILW

There is no law against someone paying too much for something.

RenovationMan

nearlynew wrote: »

possibly the most boring thread you have ever started gen.


caveat emptor I say.

Better this than wading through the juvenile tit-4-tat arguments of ex-credit crunch and ex-HPC members.

My mouse wheel is getting quite worn out on this forum these days.