Mortgage fraud

Mortgage fraud is dishonestly obtaining a mortgage loan or registering a mortgage by deception, for example through falsified income, inflated valuations, straw buyers, or identity theft used to mortgage someone else's property. It can be prosecuted as fraud or forgery under the Criminal Code and also gives rise to civil claims.

How BC law treats it

Under the Land Title Act, RSBC 1996, c 250, s. 25.1, a void instrument such as a forged mortgage generally does not give the registered mortgagee an interest in the land, subject to limited exceptions (see Gill v Bucholtz, 2009 BCCA 137). An owner deprived of land through fraud may in some cases claim compensation from the assurance fund.

What it means for your business

Owners should monitor their title and consider title insurance, and lenders should verify identity carefully, since a lender relying on a forged mortgage may lose its security.

Risks and common mistakes

Failing to verify a borrower's identity or a signing officer's authority can leave a lender holding a worthless charge.

For the full explanation, see our entry on Mortgage.

General information about British Columbia and Canadian law, current to October 2026. It is not legal advice.