Cashbacks, fake papers: The evolution of scams

April 19, 2008

Cashbacks, fake papers: The evolution of scams

1994

Power of attorney for cash

Housing agents get sellers of Housing Board flats to sign over the power of attorney in return for personal loans.

These agents subsequently sell the flats for prices higher than pre-agreed amounts, and pocket the difference.

The Association of Singapore Realtors, a predecessor of the Institute of Estate Agents, says the scam has been around for at least three years and agents from at least five firms are involved.

1995

Under-declaration to save on fees

The Government revamps resale procedures of HDB flats to deter buyers and sellers from under-declaring the price of a property to save money on the resale levy and stamp duty.

Under-declaration is made a criminal offence, and agents are required make statutory declarations on resale prices.

2005

Cashback scam

Two housing agents - Tony Ho Nam Tung and Teo Pei Pei - are fined $8,000 each for helping their buyers to over-declare the price of their $390,000 five-room flats by $100,000.

The PropNex agents are the first to be convicted over the rampant cashback scam. The scam is used by buyers to get extra cash via inflated home loans.

In April that year, the HDB imposes curbs on the cashback practice, causing overall resale prices to drop by 4.8 per cent in the subsequent quarter.

2006

Fake documents

Seven property agents are jailed for helping flat buyers get bank loans with fake employment documents. The scam involves shell companies 'employing' the buyers, with money being deposited into their Central Provident Fund accounts to give the semblance of a regular income.

The seven agents are Tan Boon Yok, Hamidah Yunnan, Syed Abdullah Alhamid, Mohammed Rusli Abdul Rahman, Tumirah Rahman, Zainon Aran and Richard Yan Hwee Oon. They were jailed between one and nine months each.

The agent with the highest profile - ERA Singapore stalwart Syed Abdullah Alhamid, 63 - has since returned to his firm and is now a division director with 150 agents under his wing.

2008

False declarations

The Housing Board introduces a checklist of detailed dos and don'ts, as well as financial rules that all agents have to go through with their clients before sealing a deal. Among them is a warning that those under- or over-declaring the price of their flats risk being jailed and fined.

This helps address the latest scourge, where owners selling their flats at a loss under-declare the prices to get some cash in hand instead of having all the sale proceeds revert to their Central Provident Fund accounts.


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Institute of Estate Agents

Year formed: 1998

Base: HDB Hub, Toa Payoh

Membership: 1,500 agents

Leaders: President Jeff Foo is from Jeff Realty, first vice-president Mohamed Ismail is from PropNex and second vice-president Low Swee Kim is from the ERA Realty Network.

History: Formed via the merger of three associations, it seeks to bring unity and enforce a standard code of conduct among housing agents, but it has been hampered by infighting. It has managed to muster only 1,500 members out of the estimated 30,000 in the industry.

Initiatives: It started the Singapore Accredited Estate Agencies (SAEA) scheme with the Singapore Institute of Surveyors and Valuers in 2005 to raise professional standards. But the IEA has since distanced itself from the scheme as it had requested to change its representatives on the SAEA board but received no response.

An SAEA disciplinary panel member Wilson Lim said that its board members were still deliberating on the request.

The IEA also runs a voluntary registry with 21,900 names from 360 agencies and issues a 'practising certificate' to members after making them sit through a code of conduct course and test.

Future plans: It has proposed amending the syllabus for the Common Examination for House Agents, which is used as a benchmark for accreditation, to make it more relevant to housing agents. It is working with the Consumers Association of Singapore on a new accreditation scheme.

EastLiving.com.sg

Contact Stuart Chng: (65) 9691 9907
Email: stuart.chng@eastliving.com.sg

EastLiving - Singapore Property and Real Estate DB