Reply With QuoteThis scam has been sold to individuals in the UK as I pointed out on this forum last year (sorry, I am not very good with links and things).
In Asia many UK land banking companies seem to be operating. Its rife at
the moment.
It would be nice if the UK FSA and Consumer orgs would link up with their partners in Asian countries. If nothing else the English are becoming the equivalent in South Asia of the Nigerian scammers we English all complain about.
The strategy
Buy cheap land with no chance of planning permission close to a big UK city. Divide it up into tiny plots. Give it a cute yet expensive name. Mark up the price by 1600% to 3000% depending on how ambitious you are. Sell it on a commission only basis in Asia and Canada where apparently unless you can prove categorically that something does not work you can sell it without criticism of any kind.
Always infer in everything you do (much like religion or any other scam) - "we have access to a secret only the rich and successful and confident have. You can have the secret and more secrets as well for less than 10 grand but you have to act quickly and dont ask anyone else, except tell your friends with money".
Control the flow of information so everything appears to be supportive. Once the investor has bought the concept be their friend while you all wait for planning permission that while certainly coming has unfortunately been delayed just a little. Dont just sell them one thing. They all know about financial diversification. Allow them to diversify their wealth into your other investment scams.
Then blame the economy, mysterious bad forces at [link removed], or [link removed], or move or start again with a new name. Or just run away and retire.
The pitch:-
The London Olympics is coming - look at what happened in Beijing.
Land prices have only dropped once in 700 years in the UK – you cant lose. (Just plain not true BTW).
In the faint chance we don’t get planning permission you still own the land (financially this is like paying for a new car to be delivered in two years and finding later you own 10 square meters of rusty steel in the middle of 10,000 square metres of steel you cant use in a foreign country).
This land is very close to something you've heard of so it must be valuable (Heathrow, London, Colchester, A London Bus, Tony Blair, Concorde etc).
We must be reputable - here is a picture of a London bus, the houses of parliament or Buckingham palace.
Its Strategic Pre-developed land (much like me being a strategic pre-handsome billionaire or pre-immortal)
Backed by (= we have an ATM card with) HSBC or Barclays or Midlands or Natwest bank or Standard Chartered.
Look at all these government reports saying about the shortage of housing. Look at all these local council reports about the shortage of housing
Look a graph with money on it. Its going up.
Look another graph going up.
We have some English football players saying how good it is. You can meet them if you invest with us.
Here is picture of a rich person (often George Soros or Richard Branson but any rich person who apparently has "the secret" will do)
We advertise on the TV and we mention that a lot.
Our independent consultant once did some work for someone important and reputable in England
Our independent consultants have prepared a plan which shows lots of houses on this site.
Our independent consultants have approved the planning proposal for this site so we have full pre-approval. (See pre-developed)
We’ve sent all our independent consultant reports to the local council so we are well connected. (they didn’t read them but who cares)
Look a London Bus with another graph going up.
Look a chirpy trustworthy cockney.
Look the Houses of Parliament again.
Look a huge number with a percentage sign after it.
The web.
If you look at many of these sites from the UK you cant see anything. (You can with Google cache sometimes). From Asia its covered with the kind of stuff that surely couldn’t be published if it wasn’t true in the UK? So the impression in Asia is of passive support from UK organisations who don’t even know they are on the website.
“stuffed” multiple web sites. When you search for the company the first page in Google shows many complimentary sites with "independent" positive comments.
For a few hundred bucks get a lawyer to issue letters of defamation cease and desist against anyone who says anything negative that appears on Google page one (yep – at least 3 of us got one - but i had already left Asia).
Last edited by Admin; 3rd May 2008 at 12:22 PM. Reason: Removed web links.
This scam has been sold to individuals in the UK as I pointed out on this forum last year (sorry, I am not very good with links and things).
Last edited by Legaleagle; 16th April 2008 at 09:23 AM.
Legaleagle,Originally Posted by Legaleagle
Last June you posted this.This is a type of scam I have come across through clients of mine who have bought land plots which are essentially worthless.
Basically the scammers buy a field in a designated Green Belt area and then have a plan drawn up dividing the field into building plots. They then sell each of these plots to an individual for (usually) between £10,000 and £25,000. The plots are hard sold on the basis that planning permission is being actively sought for the land and when planning permission is granted the plots will be worth a lot more than you paid for them. The Scammers tell you that they (or a developer) will buy the plots back once planning permission is granted at the new market value which will be higher because the land is now development land. What the scammers don't tell you is that:
1) There is no prospect whatsoever of planning permission being granted for development of green belt land as it is protected against development by Act of Parliament.
2) The scammers have no obligation to even apply for planning permission under the terms of the contract and in some cases they do not even bother to do so.
3) There is no recorded case of a Land Bank scheme ever producing a successful return for the investors.
4) Building Companies are not interested in buying development land from multiple small plot owners in any case. When you objectively consider the logistics and economics of a big builder paying full market value for each of the small plots in a Land Bank there are so much easier and cheaper ways for them to acquire development land.
5) There is no contractual obligation on anyone to buy the land off you even if planning permission is granted, the only obligation is on you to sell it back to the scammer if he requests it.
There is a good site with articles about the Land Bank scam herehttp://www.propertyscam.org.uk/htdocs/fivemyths.htm
Yeah sorry for repeating. I was aware of the original post. Its just they've moved their wares around the world and added a strong "you can't go lose investing with anything English" element to it so I felt it worthy of renewal.
Not quite. Policy for green belts is set in Planning Policy Guidance 2: Green Belts. Green belts are not protected against development. They are protected against "inappropriate" development. The words "appropriate", "in general", "special circumstances" and so on appear an awful lot throughout the document. What this actually means is that since private businesses are unlikely to be able to do anything in them, the government and local councils have a souce of essentially free land to whatever they feel like. Things like roads and sports facilities are specifically mentioned as "appropriate", and as long as some kind of justification is given, they can do pretty much what they please. Green belts aren't as bad as sites of special scientific interest, which are essentially a label inviting as much industry and development as possible, but they're not even close to what most people think they are.1) There is no prospect whatsoever of planning permission being granted for development of green belt land as it is protected against development by Act of Parliament.
Yep, agreed and thanks for the link. I was oversimplifying. I think ,though, for the purpose of making the point that this is a scam, it is important that people understand that it is less likely that the land is going to achieve planning permission if it is in a designated Green Belt and that they should treat claims that planning permission is likely to be granted with even more scepticism.
How do we do the due diligence on one of these companies? Anyone heard of Asset Land Investment PLC located in Mayfair?
The best way is to explain scams is in a generic fashion so that people can learn how they work and so how to spot them.
When it comes to naming individual companies, you really need to have supporting evidence or you could find yourself in a lot of trouble.
.
I recently received instructions from a Company based in Gibraltar to sell a dozen or so small plots of undeveloped land to private individuals for circa £10,000 each. Being wise to the scam I questioned the "front man" about it closely. It turns out there are no planning permissions for the land, no contract exists which compels anyone to even apply for planning permission, no contract to re-buy the land if planning permission is granted. The instructing Company has convinced the "punters" to pay the purchase money directly into its bank account, (not through the solicitors as is normal) and also convinced them to buy the land without taking their own legal advice.
Classic land bank scam. I told these people where to get off pretty sharpish and they are no longer clients of mine. I just pray they don't find another solicitor who either 1) is not familiar with the scam and goes ahead with the deal in good faith, or 2) doesn't give a **** and goes ahead with it anyway.
What gets me worked up about it is that due to confidentiality rules I can't even tell anyone about it, would dearly love to tip off the Police, DTI, Trading Standards, etc. but can't without risking my livlihood.
I agree with Cuddles.
For now, we do not know which of these green belt lands will be developed. We should be cautious to like what Legaleagle mentioned. But i think it's also unfair to judge and say that these GreenBelt lands will never be developed. Many people do not realize that GreenBelt Land Policy is being relaxed slowly but surely. It is up to the landbanking companies to know which lands will the Government develop. ( through Govt websites & the companies they hire to scout etc. ) We have seen some landbanking scams but there are also companies doing the real deal. I would suggest to whoever is reading this that you be cautious and aware of LandBanking news. Do your part of due diligence when dealing with the company as well. To generalise LandBanking as a scam because of some black sheeps is a pretty amateur act.
PS: This comment is purely from my own experience. Cheers.
Could you define 'the real deal' and explain how it differs from a scam?
Many people do not realize that GreenBelt Land Policy is being relaxed slowly but surely.
I never claim to be an expert but this is a wholy false statement. let me make this very clear, it is untrue, very untrue.
Green Belt policy remains unchanged and, in fact, has tightened in the last couple of decades. And the policy is not a secret - it's here:
http://www.communities.gov.uk/public...dbuilding/ppg2
The land banking agents do not have any special knowledge unavailable to the real land owners of land leaving the green belts. Land releases are available for all to view in what are called Unitary Development Plans (UDPs) for each planning authority an example can be viewed here:
http://www.bradford.gov.uk/the_envir...vice/planning/
The UDPs are being replaced under new legislation with 'Local Development Frameworks' (LDFs) that serve the same purpose in that they identify and allocate land use. No changes to PPG2 (Green Belts) were introduced in the legislation setting up LDFs
http://www.planningportal.gov.uk/upl.../ldfguide.html
If you want to speculate on changes in land use allocation in these plans (which is what land bankers promise you) it's quicker and cheaper to do it yourself. Agricultural land isn't expensive - it's certainly cheaper than the rip-off prices pushed by the land bankers - and there's plenty to be had. Green belt land does tend to be slightly more expensive.
"No statement should be believed because it is made by an authority." Robert Heinlein
I would think that what theInvestor meant was that real deals are the ones that will get your investment returns... However, because some people go around claiming that investing in a certain investment (e.g. land investments) will guarantee returns, when the returns do not come back and in addition, the money that was initially invested was all lost, we can't say that is the real deal. This could probably be a scam. But then again, this is my speculation...
BTW, on another note, the green belt land policy is not exactly tightening up. In fact, due to the increasing population and (relatively) decreasing land that is available in the UK, the govt is opening up some of the green belt land for investments and buildings... This is to accommodate the future need for homes etc. Therefore, being asked to invest in green belt lands does not mean that you were scammed... It just depends on whether the company that asked you to can be relied upon.
The land releases that will satisfy this demand are identified in: 1) existing Structure Plans and UDPs; 2) Emerging LDFs. Any other land will remain covered by 'green belt' rules as defined in PPG2 and in individual planning authority policy derived from the local (inspected) interpretation of PPG2.In fact, due to the increasing population and (relatively) decreasing land that is available in the UK, the govt is opening up some of the green belt land for investments and buildings... This is to accommodate the future need for homes etc.
What the land bank scam does is play on the fact that land will be released from the 'green belt' in line with these plans as a way of making a margin on purchases of agricultural land. The land likely to be released under loval development frameworks is unlikely to be sold in the manner of 'land bankers' since it is either in existing historic private ownership or owned by the development arms of large house builders. I can't say that every land bank offer is a scam but since most of them are, the consumer is best to ignore any offer.
However, the real scam lies in the parcelling up of land and selling it at in excess of double that land's current market value. There is the possibility that this land may become more valuable over time and a very, very small chance of it being developed. If anyone tells you otherwise they are at best talking bullshit and at worse telling montrous porkies!
If you want to do this, go to a land auction and buy agricultural land directly. You'll get a little income and you never know your grandchildren might profit from it!
"No statement should be believed because it is made by an authority." Robert Heinlein
See, that is my understanding of Land Banking also. And neither of our posters sympathetic to Land Banking have explained how 'the real deal' can be any different to the scam as Tim has outlined. If by some unlikely fluke - out of the hands of the Land Bankers - the land does one day become profitable - this doesn't make it 'the real deal'.
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