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Land valuation fraud: are you safe?

There is no country without land. It is for this reason; many countries do not allow any foreigner to own land. It makes sense that way: how can a government be in power without a territory it owns?

In Uganda, the different land tenure systems mean several opportunities for rent-seekers and fraudsters to commit land fraud. In this article, part 1 of the series of articles on land fraud, we focus on land valuation fraud.

What is fraud?

The ‘intentional misrepresentation of a material fact, to cause again to one party and a loss to another’, is referred to as fraud.

Was it intentional? Was it done by a sane person? Did they know what they were doing? If yes, it was intentional.

Did it influence the decision? If yes, it was material.

Did the subject or their related party gain at the expense of the organisation or any victim? If yes, there was again.

Fraud is one of the various problems faced by government institutions and rampant in almost every entity and sector worldwide. Following the Uganda corruption report of 2017 (GAN integrity), it was revealed that fraud in land administration is high with cases of land grabbing, forgery of titles and bribery among others on the increase by the year.

It is estimated that Uganda government loses over UGX. 30 Billion annually to valuation fraud alone. According to RICS (Royal Institute of Chartered Surveyors), valuation refers estimation or appraisal of an asset’s monetary worth which is especially estimated by a professional valuer. Among the various methods of valuation is compensation/compulsory land acquisition. This entails government acquiring privately owned land for public purposes through negotiations and agreement between the landowner and government or the authority acquiring the land. Because compensation involves various financial arrangements, assessment of property has to be carried out.

The Ministry of Lands, Housing and Urban Development, under the Department of Valuation, which is headed by the Chief Government Valuer, all the valuations intended for acquiring land from the private owners are handled. The valuation department is responsible for providing technical guidance through a land assessment to support land management and ensure value for money.

This is where the catch is. Only a government valuer can value land in Uganda. Some people, therefore, know who to contact in case they want to manipulate land values so that they get a valuation that is higher in a given location for a specific land. Also, the valuer could deliberately put the land values below the market price. And there seems to be no recourse following a government valuers’ figures. It is heartbreaking considering that for many people, the land is the only asset in their family balance sheet.

A case of Bunyoro land theft

Despite this, the ministry has continuously faced challenges of fraud when it comes to valuation. For instance, on the 13th of September 2018, it was published that land in the Bunyoro oil region was undervalued and therefore property owners were not compensated with the right amount of money.

Following the research carried out in the past years we look at several land probes by the Uganda land commission, where cases of top government officials fraudulently acquire big pieces of land in prime locations.

The valuation fraud is manifested in several land transactions right from when a person acquires or purchases a certain piece of land to when they decide to dispose of it.

The government lacks the national valuation standards and guidelines and due to its negligence. This leads to billions of money lost to valuation fraud. This negligence has led to a reduction in the generation of taxable and non-taxable revenue to the national treasury.

The delay in land acquisition for government projects due to speculative and exorbitant compensation claimed by project-affected persons has also contributed to the loss of government funds. The delays in the implementation of government projects have negatively impacted on government expenditure inform of delayed service delivery and increased costs of implementation.

In addition to the challenges, landowners complain about the compensation rates due to inadequately skilled staff to deliver on time, which delays the government programmes.

However, to reduce the loss of money, the government should go ahead and increase the levels of resourcing the valuation department in terms of technical staff equipment and funds and also give them adequate attention so as to avoid a number of challenges that are being faced.

More so specialized pieces of training need to be conducted so as to sharpen the valuers’ skills so as land valuers can deliver better valuation services. With those scenarios, the government has tried to update the land registry, and provide valuation department with the required equipment.

The government must establish a mechanism to review the work done by the official valuers. The IG, OAG, Internal Audit etc, accountability bodies must take interest in the work by the valuations office to provide protection to citizens.

© 2020 The summitWHITE Team

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