RLA News Service

Residential landlords and other investors across the United Kingdom may have been victims of one of the largest buy-to-let scams in recent memory. According to a report in the London Times, Britain’s Serious Fraud Office (SFO) has decided to launch an investigation in a scheme which saw a now defunct firm known as Morris Properties allegedly selling up to 1,000 buy-to-let flats that were reportedly heavily overpriced. According to media reports, Morris Properties also promised clients that buying a flat would lead to a guaranteed rental income.

The alleged scheme occurred between 2004 and 2007. According to the Times, Morris Properties’ founder may have made as much as £69 million through the sale of buy-to-let flats. Although the company’s founder rejects any notion that he broke the law or acted in an unethical fashion, 133 clients of Morris Properties are now demanding answers and want someone held accountable. These investors and landlords have hired lawyers and are claiming that some of the flats sold to them during the housing bubble of recent years were overpriced by as much as 100 percent. The Times reported that a lawsuit is likely to emerge early in the New Year.

Meanwhile, British authorities have launched their own investigation and noted that the alleged scam may have affected landlords in Leeds, Manchester, Newcastle, Glasgow, London, Liverpool and several other cities in the UK.

Thank you to David Leppard of The Times for the initial report.