Comment posted in my blog, www.tankinlian.blogspot.com.
The UK has just prosecuted the first case for Land Banking. The people involved got 6 years in prison. http://blogs.mirror.co.uk/investigations/2012/12/as-the-first-crooks-get-jailed.html
The maths made the fraud hugely lucrative - one field they bought near Folkestone in Kent for £42,000 was divided into 106 house-sized plots which they sold for £10,000 each.
But the land had no chance of being developed - some was in an Area of Outstanding Natural Beauty, some was on a hill so steep that it was suitable only as a ski slope and some wasn't even theirs to sell.
But the Judge was scathing about the authorities for allowing such frauds to flourish, calling on the Government to "look with some urgency at regulating these sorts of businesses", which the National Fraud Authority says costs victims £1.2billion annually.
I attended a couple of land banking promotions in the last few years. I asked a few questions which the promoters never answer properly so, I never invest in land banking but I enjoyed lunches they provided.
ReplyDeleteUnfortunately, I avoided foreign land banking frauds but walked right into Lehman related investment trap set up by local financial instituitions.