Fraudulent Mortgage Assignment in Jamaica: Fake Lender Transfers and Loan Account Manipulation

• A mortgage assignment transfers the lender’s rights to a new entity, which then collects repayments.
• Fraudsters have used fake assignment notices to redirect mortgage repayments to their own accounts.
• Genuine mortgage assignments should be registered at the NLA and notice given to the mortgagor.
• Mortgagors who receive unexpected assignment notices should verify the assignee’s identity independently.
• Payments made to a fraudulent assignee do not discharge the genuine mortgage debt.

When a financial institution assigns a mortgage — transferring its rights as mortgagee to another lender, fund, or securitisation vehicle — it is required to register the assignment at the NLA and to notify the mortgagor of the change. From that point, the mortgagor makes repayments to the new mortgagee. This process, while common in the financial sector, creates a window for fraud. A fraudster who has access to a mortgagor’s loan account details can send a convincing-looking “assignment notice” directing the mortgagor to redirect future repayments to a different account. The mortgagor, believing they are complying with a legitimate administrative change, sends payments to the fraudster’s account, and the genuine mortgage debt goes into arrears. When the genuine lender eventually commences possession proceedings, the mortgagor discovers that their payments did not reach the correct account and that they remain liable for the full outstanding balance.

How to Verify a Mortgage Assignment

Mortgagors who receive notice that their mortgage has been assigned should take several steps before redirecting any payments. The assignment should be registered at the NLA, and the mortgagor or their attorney can search the title to confirm that a registration in favour of the named assignee appears on the register. The mortgagor should contact the original lender directly — using contact information previously established as genuine, not details provided in the assignment notice — to confirm the assignment. The assignee’s identity should be independently verified: a genuine financial institution or fund will have a registered corporate presence that can be verified through the Companies Office of Jamaica. Any assignment notice that cannot be confirmed through these independent channels should be treated as potentially fraudulent, and no payment should be made until the matter is resolved.

Legal Position of Mortgagors Who Pay a Fraudulent Assignee

Under Jamaica’s property law, a mortgagor who makes a payment to a person claiming to be the mortgagee is generally discharged from liability only if they paid in good faith and without notice of any defect in the payee’s title to receive the payment. If a fraudulent assignment notice was the only basis on which the mortgagor directed payments to the wrong account, the mortgagor may be able to argue that they acted in good faith. However, this is a legally complex position and does not guarantee that the genuine lender will waive its claim to the outstanding arrears. The safest course is to verify the identity of any new payee before making any payment, rather than relying on a subsequent defence that the payment was made in good faith.

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