There have been several cases in Australia where properties have been sold without the true owner’s consent. Identity theft itself is a crime.
In Queensland, real estate practitioners are required to take reasonable steps to verify the identity and ownership of property together with the property description before auctioning, selling or leasing a property (section 19, Property Occupations Regulation 2014). The legislation does not make clear what would be considered ‘reasonable’, however, the Office of Fair Trading sets out guidelines for verification of identity and property ownership (OFT guidelines).
Given that the Office of Fair Trading will consider compliance with the OFT guidelines as having fulfilled the “reasonable steps” requirements of the law, the REIQ strongly recommends that all real estate practitioners follow the OFT guidelines.
There are different identification requirements depending on whether the seller is an individual, company or trustee of a trust. In essence appropriate identification should be sighted and verified and a title search carried out on the property to confirm the property description.
Real estate practitioners who fail to meet their obligations to verify identity and property ownership may be subject to disciplinary action initiated by the Office of Fair Trading or a potential civil action by a person suffering loss as a result of the real estate agent’s inaction (i.e. a buyer who has purchased property from a seller who is not the true owner, or the true owner of the property).
The benefits of carrying out verification of identity for land transactions include:
- Ensuring a person is who they claim to be;
- Reducing the risk of identity fraud; and
- Preventing the registration of fraudulent land transactions.
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