The Hindu : Tamil Nadu News : Real estate white collar crimes on the rise

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Sunday, Aug 10, 2008
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Tamil Nadu

Tamil Nadu

Real estate white collar crimes on the rise

Long- drawn legal procedures have been a cause for spurt in real estate crimes, writes
V.S. Palaniappan

Boom in real estate business has opened up yet another avenue for white collar crimes. District Crime Branch and City Crime Branch have been receiving complaints about fraudulent practices in real estate transactions. The City Crime Branch police recently received two such cases.

In the event of the crime being absolutely civil in nature, the aggrieved parties approached the court for directions to the police to register a case and investigate. Earlier, people dealt with real estate as a part time business, but thanks to the boom in economy, revival of industries and increasing affordability of the people, real estate has emerged as a full time business.

Real estate mediators get a commission of one to five per cent of the transaction value from both the buyer as well as the seller. More and more persons were getting into real estate business tempted by quick money. Police officers pointed out that the main kinds of white collar crimes in real estate business that had come to light so far were in regarding sale of properties earmarked for acquisition, reserve sites and misuse of power of attorney, breach of trust, violation of sale agreements and taking possession of properties through forged wills. Reminding people about the precautions to be taken before paying cash for buying a property, police officers pointed out that property owners or those in possession of power of attorney for a property often entered into agreements and took money from more than one person for the same property. Since, sale agreements were not registered, encumbrance certificate obtained from the Registration Department will not throw any light on the likelihood of the commitment given by the seller to more than one person. Similarly, people also resort to sale of sites marked as reserve sites or sell layouts on lands notified for acquisition. Another trend was henchmen resorting to illegal arbitrations, intimidating and coercing the owner of a prime property to sell it at a throw away price or guideline value. Often such gangs operated with political support.

Often legal heirs living abroad for a long time on their return to the country found their properties in possession of someone else by using a forged will or because other legal heirs refused to part with a share that these victims were entitled to. The law is adequately equipped but because of the offence being a civil dispute, the police have no jurisdiction to interfere and victims are advised to seek legal remedy or recourse. Indian Penal Code provisions, for example, 420 (cheating), 120 B (conspiracy to cheat), 406 (Criminal Breach of Trust) and provisions for punishing criminal trespass into a property like sections 447 to 457, sections 467 to 471 could be invoked against the offenders. The complainants could also seek remedy under section 418 for causing loss for the purpose of wrongful gain. Though, fed up with long drawn civil legal formalities and procedures, petitioners are often reluctant to fight such complaints legally. Lengthy legal procedures and inadequate punishments to offenders, ranging from six months to a few years of imprisonment, often attract people towards white collar crimes.

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