Corporate Seal Forgery: How Company-Owned Properties Are Being Transferred Without Board Authorisation

• Company-owned property is being sold using forged board resolutions and company seals.
• Directors or minority shareholders may be excluded from decisions affecting company land.
• The Companies Act requires proper authorisation for major company transactions including property sales.
• A title search shows company ownership — but not whether the transfer was properly authorised.
• Buyers of company-owned property should verify authorisation through company records at the Companies Office.

When property is registered in a company’s name, the legal mechanisms for transferring it differ from an individual sale. A company can only act through its authorised officers and in accordance with its memorandum and articles of association. In most cases, the sale of a significant asset such as real property requires a resolution of the board of directors, and in some cases a resolution of the shareholders. Fraudsters who wish to transfer company-owned property without the genuine approval of the company’s governance structure must therefore fabricate that approval — and the most common method is the creation of false board minutes and the use of a forged or misappropriated company seal.

The fraud may be perpetrated by a director or officer of the company acting without the knowledge of other directors, by an external fraudster who has obtained the company’s seal and access to company letterhead, or by a combination of insiders and outsiders. The title search conducted by a buyer’s attorney will confirm that the property is registered in the company’s name, but will not reveal whether the board resolution authorising the sale is genuine or fabricated.

Buyer Due Diligence for Company-Owned Property

Any buyer purchasing property from a company should, as part of due diligence, request a certified copy of the board resolution authorising the sale and verify the identity of the directors who signed it against the company’s registered particulars at the Companies Office of Jamaica. The Companies Office maintains records of registered directors and company officers; a resolution signed by persons who do not appear as registered directors should prompt further investigation.

Where the company is closely held — with only a small number of shareholders — a buyer should also consider seeking a statutory declaration from each shareholder confirming awareness of and consent to the transaction. This additional step is not always commercially practicable, but it substantially reduces the risk of purchasing property from a company whose sale was not properly authorised. The Companies Office can be accessed at companiesoffice.gov.jm.

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