006, Dr. Sandi M. Smith, Director of Institutional Relations, Global Learning Semesters, Inc.

Legal liability is often used as a weapon to guard off the timid or defend the brave. However, many staff and faculty involved in study abroad programs do not have a notion of what legal liability is and how it should guide the design and maintenance of every study abroad program.

The following article is a layman’s introduction to complicated legal principles and precedence related to the administration of study abroad programs. Clearly, it is necessary to deliver a disclaimer… the information herein is not intended to substitute for competent legal representation. The following description of legal liability is for informational purposes only. The concepts discussed here can be helpful in guiding questions for your institutional and personal legal counsel.

Liability as a legal doctrine makes a person responsible for the damage and loss caused by his/her acts and omissions regardless of culpability (culpability is a measure of the degree to which a person can be held morally or legally responsible). However, for breach of contract or a tort, culpability may increase the measure of damages payable to compensate the plaintiff.

Sources of Liability

It does not matter our legal vocabulary and understanding, liability is something in which we are all obligated. Based on various established legal theories and precedence, duties and responsibilities are imposed on us and can carry an obligation of compliance.

The four main categories of legal liability relevant to the administration of study abroad are:

• tort law
• contract law
• criminal law
• federal law
• immunities
• professional regulation

Tort Law

Strict liability often applies to those engaged in hazardous or inherently dangerous ventures. The law imputes strict liability to situations it considers to be inherently dangerous. It discourages reckless behavior and needless loss by forcing potential defendants to take every possible precaution. It also has the effect of simplifying litigation and allowing the victim to become whole more quickly. According to strict liability, the plaintiff needs to prove only that the tort happened and that the defendant was responsible. Neither good faith, nor the fact that the defendant took all possible precautions are, valid defenses.

Tort law is focused on negligence for which damages may be awarded. Common tort liability is commonly measured by this question:

“Would a reasonable person have known or should have foreseen the risk or harm?”

To prove negligence, the injured party must prove,

1) the existence of a duty which the offender did not meet, and

2) that the effect of that specific failure resulted in injury to the plaintiff.

A few of the “duties” relevant to study abroad administration are:

Special relationship

In loco parentis is practiced to different levels at different types of campuses. For example, a church-related institution with strict behavioral codes invokes a higher standard of in loco parentis than a state-funded university. Yet, most institutions do not assume the responsibility of in loco parentis. However, it is commonly accepted among international educators that we are held to the expectations of “special relationship”, in which a duty of care is imposed because of special circumstances. Because there are more unknown factors involved in an international experience, there is a relative dependence of the student on the sponsoring institution. Thus, educators and administrators familiar with the expectation of treating college students as adults, must re-evaluate so me responsibilities when related to international programs.

Landlord relationship

Legal duties may be assumed of the property on which international programs are conducted. Although the program sponsor may not be the owner of the facilities, and it is not reasonable to expect that foreign landlords have the same standards as we do for students in the U.S., the sponsor assumes the duty to ensure reasonable standards. This includes duty to maintain the premises, provide adequate security, and warn of potential hazards.

Reasonable person standard

It is fair to assume that the courts will look to impose liability where sponsors/institutions, have not been prudent or demonstrated good faith in the care of those with whom they serve. However, the fundamental precept of negligence that the law will look to determine is “what a reasonable person under the circumstances would have done.”

Contract liability

Contractual understandings that may be written or oral. Unlike tort liability, contract liability is not imposed according to a duty, nor on the basis of what a reasonable person would do. Rather it is clearly an issue of “what does the contract say?” Thus, parties can control liability according to the agreement they come to. Obviously a written contract can be proven more substantially than a verbal contract. And reliance on a verbal promises outside of a written contract are not usually admissible.

Printed/media informational materials

Contracts can be created outside of a signed document. Colleges and universities have been found to be liable for representations in catalogues and other printed materials. Thus, pamphlets, flyers, brochures, letters and even websites are enforceable.

Signed agreements and contracts

Obvious reliance is placed on signed contracts and agreements. Weather it be pre-approval of transfer of credit or contracts for bus transportation, these contracts are meant to protect both parties. The more precise the terms of a contract, the m ore common understanding exists between parties. Most institutions have rules about who has the authority to sign contracts. Thus, when developing forms related to international study, it is important to have legal counsel and senior administration decide who has authority over specific types of signed agreements. Similarly, many institutions have policies and procedures about procurement contracts and thus, if an international program needs to sign contracts for transportation, housing, insurance, etc. there should be institutional policies for vetting and authorizing these contracts.

Federal Law

Federal law, in most cases, does not reach outside the U.S. Thus, returning to the special relationship precept,, international programs may technically be liable for maintaining standards of U.S. Federal Law as much as is reasonable. Furthermore, international programs will be under jurisdiction of the Laws of the host country. Some of the federal laws that have relevance to international programs are:

- civil rights

- FERPA

- Campus Security Act

- Drug Free Schools Act

Criminal Law

Obviously, those participating in and administering study abroad programs are subject to criminal law. The most important factor to realize with criminal law is that participants and administrators are subject to local and national law in the U.S. and ALSO subject to criminal laws of the host country and any country visited along the way. The U.S. Embassy in foreign countries is a good source or information for understanding relevant host country laws. OSAC, Overseas Security Advisory Council provides relevant information at: http://www.osac.gov/. Legal protections in the U.S. are not applicable to foreign countries. And the “I did not know” defense will not protect you. Some of the criminal laws relevant to study abroad are:

- vandalism

- assault and battery

- murder

- robbery

- drugs and alcohol

- political speech

- vehicle operations

Immunities

Immunity from prosecution is offered to those employed by a public institution and may apply to certain circumstances within the responsibilities of an international program. Sovereign Immunity established by the Eleventh Amendment of the U.S. Constitution basically bars suit in federal court against entries or agents acting in an official state capacity. However, this does not absolve institutions and employees of prosecution for negligence.

Program Sponsorship

It is commonly referred to as “deferred risk” when turning over students to a third-party program provider. Many institutions, realizing that they do not have the staff and resources to provide the best standard of care and expertise to study abroad programs have wisely deferred the risk of liability to a program sponsor. A deferred program sponsor may be another U.S. college or university operating international programs or an independent study abroad organization. Entering into an exchange agreement or direct enrollment agreement with a host institution does no defer risk of liability.

Legal principles for managing study abroad programs are similar to the standards used at home. Institutions are expected to “understand the nature of the program activity so that the educational benefits can be measured against the risk of harm.” (Weeks, pg. 3) Program sponsorship should be reserved for those with expertise to provide the expected duty of care, including:

• faculty and administrators should possess adequate expertise in the site location (language, culture, laws, social standards, political status, geographic and climatic issues, crime and safety, emergency resources),
• the distinct components of a program should be clearly articulated and assigned to responsible staff (faculty may be experts on the language or academic content, but not adequately trained to respond to student conduct issues, or housing safety, or emergency response),
• responsible staff are sufficiently trained and accountable for the performance of their assigned duties,
• adherence to safety standards when structuring the program, negotiating contracts, and facilitating student interactions,
• responsiveness to incidents and emergencies

Another function of program sponsorship is eminent domain. What laws and jurisdiction apply to any prosecution that might occur?

Program Structure/Risk Management

Offering a course at an international location does not inherently create a higher risk. However, there are risks inherent to some international locations, and obviously to inexperienced travelers. Studying in a classroom or library in London is not inherently more risky than in the U.S., and filed experiences in archeology will inherently have more risk in the U.S. or abroad than studying in the library. Program structure and risk management should take into consideration some of the factors that do make study in another country more risky including:

• language
• laws and cultural customs related to alcohol consumption
• traffic patterns and laws
• social customs and interactions
• safety standards of buildings, walkways, vehicles
• public health and safety
• travel-related and site-specific high risk activities

Resources:

Association of Safe International Road Travel: http://www.asirt.org.

Consular Information Sheets: http://trave.state.gov/travel/cis_pa_tw/cis/cis_1765.html

NAFSA Responsible Study Abroad:

http://www.nafsa.org/knowledge_community_network.sec/education_abroad_1/education_abroad2/practice_resources_12/health_safety/guidlines_for_health

SAFETI Clearinghouse: http://www.globaled.us/safeti/

IES Map: http://www.iesabroad.org/iesMap.do

U.S. State Dept. Travel Resources: http://www.state.gov/travelandbusiness/

Worldworx Travel Safety: http://wwww.worldworx.tv/safety/

Duty to Advise

A serious responsibility of any college or university is the function of academic advisement. More resources are being assigned to student advisement whether through faculty advisors and/or professionally trained advisors. With this increased recognition of a duty to advise, it is expected that colleges must provide the same level of informed and thorough advisement and orientation for students selecting international programs. The duty to advise encompasses choosing a program, academic structure, host country, eligibility requirements, cost, application procedures and deadlines, pre-departure orientation, conduct expectations, waiver of rights, credit transfer, financial aid, transition adjustment, and more.

Disclosure of known risks is expected. A duty of care includes:

• known or expected political, social, terrorist risk
• assessment of crime
• road, traffic and vehicle conditions
• health risks
• cultural and legal differences
• independent travel
• past incidents of students and staff
• local informants
• encourage questions and provide responses

Student Misconduct

The duty to advise must clearly cover behavior and conduct expectations of students. Depending on program sponsorship, a student should know if he/she is accountable to home-campus conduct and disciplinary standards, or does the sponsoring agency supplant home-campus policies?

Furthermore, it must be clear as to the expectations for “off-campus” conduct while participating on an international program. What is considered “off-campus” while on a program abroad: is the program housing off-campus, are group meals considered off-campus, and is weekend travel considered off-campus? An example of a U.S. campus issue is alcohol consumption in the students’ residence. Some campus residences may have rules prohibiting alcohol consumption, yet public institutions would not expect to prohibit alcohol consumption in off-campus apartments (some private institutions do have general alcohol consumption policies and attempt to prohibit it at any time on and off campus). Thus, is sponsor-provided housing on an international program considered on or off-campus?

Due process is another issue that is sometimes blurred on a Study Abroad program. It is fairly uncommon to have qualified staff to investigate student misconduct allegations, and provide due process that is expected on the home campus. Thus, it must be clearly stated that students will either waive due process or experience an abbreviated version of due process in academic and/or conduct issues while abroad.

Students should also be informed if they will face home-campus disciplinary sanctions for conduct infractions while aboard. If there are exceptions to home-campus conduct (particularly drinking age), students should understand the policies as they apply to study abroad.

Students should be informed that they are subject to local and host country laws and should not assume that those laws are the same as U.S. laws (especially regarding public intoxication, traffic offenses, drug possession, use and sales, and sexual misconduct).

Federal Statues

The following federal statues can be applies to education abroad:

Title VII of the Civil Rights Act of 1964 makes it unlawful to discriminate in employment based on race, color, religion, sex, or national origin.

Title IV of the Civil Rights Act of 1964 makes it unlawful for programs that receive federal funding to discriminate based on race, color, religion, sex, or national origin.

Title IX of the Education Amendment of 1972 make it unlawful for programs that receive federal funding to discriminate on the basis of sex.

Age discrimination in Employment Act of 1984 makes it unlawful to discriminate in employment based on age.

Campus Security Act of 1990 (Clery Act) does not contain any clear indication that it is intended to apply outside the U.S. boundaries, unless specifically a branch campus. However, in the duty to advise, it is expected that institution swill maintain data on incidents and disclose as appropriate.

Drug-Free Schools and Communities Act Amendments of 1989 are tied to federal funding. So the argument can be made that if any federal financial aid might be used for a program, it is required that the same requirements apply.

Family Educational Rights and Privacy Act of 1974 (FERPA or Buckley Amendment) It is not possible to dictate the policies and procedures of foreign institutions, however, it is necessary to understand the foreign institution’s policies and procedures. FERPA standards of care in confidentiality management should be taken by U.S. representatives.

Rehabilitation Act and Americans with Disabilities Act (ADA) is not intended for overseas institutions, however, most colleges continue to serve students where reasonable accommodations can be made. And some foreign host institutions now apply a similar standard of care in making reasonable accommodations for students and employees with disabilities.

Crisis Management

Every campus is expected to have a crisis response plan, and thus has an outline and structure that can be translated to overseas programs. It is reasonable to expect that any institution sponsoring international activities will make proactive efforts in crisis management and response planning.

Summary

Legal liability is created by the violation of duties imposed by the 1) common law, 2) statutory law (state and federal), and 3) contract law. And despite the complexities of the law there are some fundamental precepts that can protect an institution involved in study abroad:

1. assume there is a duty to act reasonably and foresee and limit the exposure to risks which are known or should be known, and act accordingly.

2. make certain that all substantive aspects of programs are fully described in writing and that program participants receive, and understand all of the materials.

3. prepare and use an assumption of risk document appropriately.

4. ensure that all participants possess adequate insurance for every reasonable contingency.

(Weeks, pg 67)

This document is a summary of legal liability related to study abroad programming. If legal advice or other expert assistance is required, the services of a competent professional should be sought.

Sources

Kaplan, William A. 1990. The Law of Higher Education. Jossey-Bass Publishers.

Weeks, Kent M. 1999. Managing Liability and Overseas Programs. College Legal Information, Inc. Nashville, TN.

Dr. Sandi M. Smith
http://www.articlesbase.com/international-studies-articles/legal-liability-relevant-to-study-abroad-736032.html

Got an invention?  Have a product which you would like manufactured?  Consider having your products made by a contract manufacturer in China. Contract Manufacturing (CM) is where one business hires another company to manufacture their product. The contract manufacturer will charge the business for the manufacturing services based on the processes, amount of labor, tooling, and the cost of materials.

There are many companies, from small Mom and Pop to large ones, that use <a href=”http://www.manufacturingsite.net/”> Contract Manufacturing Services</a> rather than running their own factories. Contract manufacturing can be used to manufacture anything from product parts to a whole product. Cabinets, doors, sports equipment and toys are some of the products being made using contract manufacturing.  Contract manufacturers can either make products to your exact specifications or help you design them. Some people use contract manufacturers on a seasonal basis. This is very useful because once the tooling is done, production runs can be started anytime new products are needed.

In addition to letting a business focus more on their product advertising, marketing, and development aspects, Chinese contract manufacturers present many other advantages.  One of the problems with many domestic companies is the cost of labor. Chinese manufacturing enables you to save money by tapping into a cheaper workforce.  Not only do you pay less,  you can increases your profits all at the same time.  Some Chinese manufacturers are even managed by English speaking Americans so there will not be any communication problems.

A great way to get your product or invention made at the lowest costs possible, without all the hassles of running your own factory, is by using a contract manufacturer.  Many quality Chinese factories are available to build your products. This is one of the best management decisions for the small entrepreneur or large company to get their brand out in the market without having to worry about the manufacturing process.

Mark Ralph
http://www.articlesbase.com/outsourcing-articles/the-benefits-of-china-contract-manufacturing-701995.html

Large law firms and in house legal departments of large enterprises have enjoyed the benefits of outsourcing (quicker turnaround and lower costs) with success for quite some time in the United States.

On the other hand, small and midsize enterprises and law firms have just begun to outsource legal work to enjoy these benefits. This has become possible with a wider availability of technology at a lower cost, in addition to the arrival of a new breed of vendors who are addressing the unique requirements of small and midsized enterprises and law firms.

These vendors are providing services with better quality, by leveraging on technology and through deployment of experts in the work which is outsourced. Lawyers from India are increasingly familiar with US law and have several years of experience in doing legal work for US law firms and in house legal departments of large corporations. It has become possible to deploy experts these days due to aggregation of work from various clients, and the cascading higher volume of work.

The law firms and in house legal departments have enjoyed the benefits of a quicker turnaround time. The work left with the Indian entity at the end of their day is completed and available when they arrive at work the next day. These have become as important as the other core reason for outsourcing, namely saving of costs – law firms and enterprises have been able to save between 50 -60% of their cost by outsourcing legal services.

What work can be outsourced?

Any work that can be done without requiring fact to face interaction with clients or physical presence in a court of law can be outsourced. Some of the typical examples of work outsourced are in:

a) Contracts: Drafting, Review and management

b) Litigation Support : Discovery management, review, analysis and coding and Presentation

c) IP Rights: Search, Application for patents and defence

d) Legal and Business research

a) Contracts – Drafting, Review and Management

We prepare first-cut drafts of contracts that are fit for purpose and conform to your house style. You need to provide:

· Standard templates that conform to your house style and

· Unique variables relating to each contract

Your lawyers would still be in control over the quality of the draft and enforceability in courts of law without having to log expensive time in preparing the first cut draft.

We can handle a wide variety of contracts including contracts for:

· Sale of securities and derivatives

· Sale of goods or services

· Sale or mortgage of property

· Lease of property

· Lease of equipments

· Employment etc

We manage your contracts by maintaining a comprehensive database of all your contracts that provide:

· Contract information (Purpose, Period, Entities, Addresses, Counsel, Validity, Termination rights, Applicable law, Jurisdiction etc)

· Summary of terms

· History of notices

We maintain a summary of all obligations and covenants (to facilitate compliance) and all rights (to enforce compliance)

b) Litigation Support

Our litigation support services include:

· Discovery management,

· Review

· Analysis and coding and

· Presentation

To help your lawyers focus on successfully winning or defending cases.

We help your lawyers to stay focused on winning the case by providing discovery management support.
Our services include:

· Understanding case issues and priorities

· Determination of collecting strategy

· Determination of work processes to speed up and yet not miss out on collecting documents

· Quick focus on most useful documents by continuous elimination of irrelevant items

· Quick analysis of documents for materiality, relevance, confidentiality and privilege; rapid automated
codification and validation

· Quick production of documents to facilitate rapid internalization and access

We can work with your proprietary document discovery management system or any standard off-the-shelf solution including ConcordanceFYI ™ and CaseLogistix ™.

In spite of increasing popularity of e-discovery, physical paperwork has continued to stay. We help your lawyers by reviewing physical paper documents and codifying them for rapid prioritization and access.

We measure our success by reducing your attorney’s document review time and cost. Not just by being more competitive than other providers in discovery process.

c) IP Rights

Our lawyers (supported by domain professionals) can support you in

· Prior Art Search,

· Assessment of patentability,

· Patent proofing,

· Invention disclosure evaluation and

· Drafting the application for patents.

We offer support in IP Asset management with review of potential or existing infringements and in litigations to protect against such infringements.

d) Legal and Business Research

We conduct research on industry standard private databases as well as public domain databases to provide research support to your team of lawyers to win/defend litigation or to provide counsel to clients on complex issues.

Our research support includes:

· Reviewing legislation

· Reviewing case law precedence

· Reviewing journals

· Reviewing contracts and

· Preparing summaries and abstracts.

Where to outsource?

Law firms and in house legal departments typically outsource legal work to someone who is willing to understand their requirements, and give quality service that they require.

TaurusQuest is one such company, which has acquired expertise in serving small and midsize enterprises better, and has been recognized for its operational excellence and delighting service. We were awarded 4th worldwide by the US based Black Book of Outsourcing for one of our services in 2007. We have a number of legal professionals who have experience in providing the services mentioned above to US and International law firms and to business enterprises. The senior executives of the company have lived and worked in the US.

TaurusQuest has two delivery centers in Chennai, India with 300 seats. For further details on our company and the services we offer, visit us at www.taurusquest.com and Contact us at enquiry@taurusquest.com

pksaravanan
http://www.articlesbase.com/outsourcing-articles/outsourcing-legal-services-690910.html

To many people, taking the plunge, and investing in property for their future is a major leap of faith. Imagine how they must feel, if their investment turns out to be an investment property Scam?

Is there a way out of any Investment Property Scam?

The first thing to realise is that if you do feel you have been conned, you are probably not the only one. It may feel like it, and you may feel alone, stupid, cheated, and angry or embarrassed – some of the common emotions felt at this time.

But, these are the emotions that developers with crooked minds will encourage you to think. They hope that you will feel ‘suckered’, and just don’t want to tell anybody. In fact, with a clever scam, there may seem to be nothing to tell anyway, apart from your gut instinct, until you start digging.

But inertia is just what these criminals (and they usually are criminals) want you to think. In these circumstances, you must not hold it all into yourself. You must try and find if other people have been duped into a similar situation. You never know, you may be one of ten, twenty or hundreds of similar souls, and if you can find, and become identified with such groups you will stand a far greater chance of getting retribution, believe me.

I got caught up in such an investment property scam about 18 months ago (I know – gasp – shock – horror – and I sell investment properties!). For some months, I thought I was going crazy, I could not understand why I could not get tenants in at anywhere near the prices I was expecting, or even get tenants at all. This was the first revelation, as I had been promised that the properties would have been fully tenanted on completion. Well, at least, that’s what the brochures said, as well as the sales manager at the presentation I attended. And I had bought a number of these ‘beauties’ each supposedly fully tenanted and making me around £500 each per month rental surplus.

Then I started to investigate the situation more thoroughly, and I soon identified the problem. It’s a down and out highly complex investment property Scam!

So how did I, an experienced property investor, and a reseller of investment properties – get involved in an investment property scam?

I’ll tell you how – perhaps Criminal Intent?

What I have done is to chronicle the events that actually took place with my investments, of which I have since found out there were well over 100 similar incidents.

Before I went into this investment, or even recommended them to others, which consisted of a number of refurbished houses converted into HMO’s for students (Houses of Multiple Occupation) I investigated the company thoroughly. (Note the company and location of these houses is not mentioned in this report for legal reasons). I checked out at least 6 of their property conversions, spoke to their rentals people, and spoke with several existing investors. I took my business partner at the time with me to check out my findings. I was also comforted by the fact that these people were spending (and still are spending) a lot of money in the big national newspapers (Sunday Times, Telegraph, and so forth), and had produced a whole range of glossy brochures backing up their claims.

Some of their larger off-plan developments were also being featured in a two-page spread in one of the UK’s leading property magazines. Not only that, but they had (and still do have) very large exhibition stands at a number of the leading UK Property Shows.

Everything seemed to stack up, so I bought a number of them, and encouraged my friends, close family, and business colleagues to buy some also. I paid my reservation fees, and just settled down to wait for these to be completed, and to start generating some surplus cash every month.

The first event in the chain of things was that the houses were very late in being completed, so we were in danger of losing the student intake for autumn 2005, but the investment still seemed quite good, and anyway we had all exchanged contracts by then. And, of course, we all thought we had at least an 11% equity holding in each property, plus the usual growth of 4-6 % from last year. Also, when asked if we could inspect them prior to completion, we were told – “Sorry, as you have tenants in them, you have to give 48 hours or more notice”. Then when we did try for appointments nobody could find the keys.

Where were my alarm bells I hear you ask –

Obviously on Silent Mode!

But then the dirt really started to rise to the surface…

These houses were all sold under the premise of ‘All contacts for services under one roof for the investor – Use our Services for Sales, Recommended Solicitors, In-house Brokers, mortgages, Tenancy Management from our Own Company’ – you know, a really good packaged deal for the armchair investor.’

Issue 1 was that the houses were not fully tenanted on completion, and in a lot of cases, the tenants seemed to ‘melt away’ after contracts had been signed. So much for the promises made in the developers’ glossies that tenants would be in place before completion, with cross-guarantees so that there would be virtually no void periods, no issues with rent, as if one tenant failed to pay, the cross guarantees meant that the other tenants would be liable.

Also, in some cases, (not with mine luckily) no renovation work had been carried out at all, and the developers then had the cheek to ask for £3,000 per property to fix those that had not been done. Then, major issues with the building work started to surface. Basements would flood, not due to rain, (although this did happen on a number of occasions where the basements had not been ‘tanked’ correctly), but due to faulty plumbing, But if course we had a 12 month warranty contract – Right? Wrong?

Even after constant phone calls and emails, the management company failed to send us proper records, and they did not keep us informed of maintenance issues, tenants leaving, tenants not paying rent on time – all the sort of standard things one was used to expect from a ‘proper’ management company that charged 10% of the rent as fees.

And the hassle I had moving the management agreements to another company is another story for another day when it can be told.

Ok, so, this just seemed like rogue building work and an outright total lack of proper management by the department handling the tenancies. Not the sort of service to be expected from a firm carrying out so much nationwide marketing, but of course, being of such a high profile firm, you would have thought they would have fixed the issues. Right? Wrong!

So because of all these issues, I had by now started to do some very intensive investigation into this company, and the methods being used to package the sale of these houses.

It then transpired that most of these houses had been bought by the developer some three to four months prior to selling them, for about £90,000 – in the developers words – derelict houses that were totally gutted; 3 bed properties that had basements opened out, and or roof conversions done, so adding as many as 2, 3 or even 4 more bedrooms, and supposedly converted to the highest of standards for HMO purposes, and these were sold to us for around £249,950 up to £325,000 and higher.

Ding Ding Ding – Alarm Bells…
Why were we quite happy to purchase them – because they all came with RICS (Royal Institute of Chartered Surveyors) valuations on the property value and the anticipated rental incomes.

All of which matched the developers claims.

But when we noticed that several investors from other groups were having some of these similar houses repossessed – as they were not getting the rent, and consequently could not afford the mortgage, and the valuations were all coming in at around £80,000 to £100,000 BELOW THE MORTGAGE VALUE!

Our own investigations then uncovered that many of these properties had been valued by the same firm, and for comparison, they had used properties by the same developer on the valuation form.

We have come across instances where the mortgages that were granted they :-

· Were not valid for multiple occupancy homes – so why was a loan granted?

· Would not have been granted had the banks known the properties were already tenanted, and not sold as vacant possession. So why was a mortgage granted?

· Would not have been granted if the valuation rental assessment was not realistic. So loans were granted on incorrect information. If the investor had put the rental figures in, they would have probably been done for mortgage fraud.

· Would not have granted a loan (especially interest only) if the true valuation figure had been known.

· Would not have granted 85% of the assumed value had they known a Gifted Deposit was being paid (along with legal and other fees by the developer). The solicitor was aware, as was the broker, so how come the lender was not informed?

Now, as I like to think of myself as a ‘savvy investor’, knowing that gifted deposits, cash backs etc happen and quite often jump start the property market on the move, I had told my solicitor(s) what the side deal was, the broker told me what the deal was, so no problem right?

Wrong… I then find out that neither the solicitor(s) nor the broker had informed the lender.

Somewhere along the lines, something was wrong here.

The question is – Was it the fault of:-

·The Developer?

·The Solicitor?

·The Broker?

·The Investor?

In a society where regulations covering solicitors, brokers, mortgage loans, and valuers seem quite strict, I must say I think something is awry here, where the hapless individual investor can walk into such an unregulated trap!

If you feel you have been involved in such an investment property scam, and would like to see if there are others in the same boat, please visit my blog where you can voice your opinion, and even add your name to a structured list if you want so we can build up a database of like events that could be easily analysed to spot trends, or passed to ‘Watchdog’ for instance.

Geoff Morris
http://www.articlesbase.com/investing-articles/how-to-avoid-an-investment-property-scam-59379.html

I have a desire to save the USA from Total Ruin by corrupt and incompetent Bureaucrats and Politicians.

Would all of you who read this vote for a mature, College educated Accountant with 30+ Years of Managing Finance and Human resource departments of corporations in Arkansas and Oklahoma. A Divorced man after 29+ Years of marriage to the same woman. His wife took up with a drug dealer and committed adultery for several years with his knowledge because He was working a full time job as Director of Administrative Services for Not-for-Profit Corporations who successfully provided services to disabled individuals through Federal and State contracts and Grants, along with Insurance and Private Direct Payment from the Client.

I doubt that being an accountant would sway my vote as the president can not spend one thin dime. the president can only advise the congress and accept or reject the spending bill they send him.