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Land Registration of Titles at Stake: West and East Malaysia Compared

Authors:

Abstract

Registration of land title evidences an indefeasible ownership. However, many people have become victims of fraud. Due to the increase in fraud and the weaknesses of the registration system in the country, this study aims to provide solution to the problem. The paper highlights the controversy surrounding indefeasibility and the concept of federalism in the land administration systems in Malaysia. The electronic land systems and fraud prevention measures in the country are also analysed. While other jurisdictions have title assurance fund, it is not available in Malaysia. Thus, this paper suggests the tightening of the security measures to prevent fraud.
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ASLI QoL 2017
AQoL2017Kuching
http://www.amerabra.org; https://fspu.uitm.edu.my/cebs
3rd ABRA International Conference on Quality of Life
“Quality of Life 3”
Riverside Majestic Hotel, Kuching, Malaysia, 14-16 Oct 2017
eISSN: 2398-4287© 2017. The Authors. Published for AMER ABRA by e-International Publishing House, Ltd., UK. This is an open access article under the CC BYNC-
ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/). Peerreview under responsibility of AMER (Association of Malaysian Environment-Behaviour
Researchers), ABRA (Association of Behavioural Researchers on Asians) and cE-Bs (Centre for Environment-Behaviour Studies), Faculty of Architecture, Planning &
Surveying, Universiti Teknologi MARA, Malaysia.
https://doi.org/10.21834/e-bpj.v2i6.988
197
Land Registration of Titles at Stake:
West and East Malaysia compared
Nuraisyah Chua Abdullah 1, Ramzyzan Ramly 2, Muhammad Izwan Ikhsan 3
1 Faculty of Law, Universiti Teknologi MARA, Shah Alam, 40450, Malaysia
2 Faculty of Mechanical Engineering, Universiti Teknologi MARA, Shah Alam, 40450, Malaysia
³Department of Law Enforcement, Vision College, Kelana Jaya, 47301, Malaysia
nuraisyah@salam.uitm.edu.my
Tel: 603 5544 1083
Abstract
Registration of land title evidences an indefeasible ownership. However, many people have become victims of fraud. Due to the increase in fraud and
the weaknesses of the registration system in the country, this study aims to provide solution to the problem. The paper highlights the controversy
surrounding indefeasibility and the concept of federalism in the land administration systems in Malaysia. The electronic land systems and fraud
prevention measures in the country are also analysed. While other jurisdictions have title assurance fund, it is not available in Malaysia. Thus, this
paper suggests the tightening of the security measures to prevent fraud.
Keywords:fraud; land registration; indefeasibility; electronic systems
eISSN: 2398-4287© 2017. The Authors. Published for AMER ABRA by e-International Publishing House, Ltd., UK. This is an open access article under the CC BYNC-
ND license (http://creativecommons.org/licenses/by-nc-nd/4.0/). Peerreview under responsibility of AMER (Association of Malaysian Environment-Behaviour
Researchers), ABRA (Association of Behavioural Researchers on Asians) and cE-Bs (Centre for Environment-Behaviour Studies), Faculty of Architecture, Planning &
Surveying, Universiti Teknologi MARA, Malaysia.
https://doi.org/10.21834/e-bpj.v2i6.988
1.0 Introduction
Title registration fraud has increasingly become a primary concern in Malaysia and it greatly violate the right of the actual owner of the
land. According to the statistics of the Department of Director General of Lands and Mines, there were 435 cases of title fraud and
forgery reported from 2005 to April 2010, with Sabah recording the highest number of cases (86), followed by Selangor (56), P enang
(47) and Kuala Lumpur (35). Among the most common occurrences is the falsification of the original issue document of title (IDT),
identification card, signature, transfer form (Form 14A), power of attorney, court‟s order, as well as impersonation as a registered
proprietor and estate agent. The same trend can be seen in the statistics published by the Royal Malaysian Police (RMP). It shows
that from the period between 2005 and 2012, a total of 730 cases were reported and Sabah still recorded the most number of cases
(154), followed by Selangor (106), Penang (55), Perak, (54) and Kuala Lumpur (53). More recently, from January to May 2016, the
RMP received 151 reports involving land fraud with losses exceeding RM30 million. The number shows a sharp increase from 2015,
which recorded 90 cases with losses amounting to RM20 million. According to the statistics, Selangor is the State where land fraud is
most prevalent, with 43 cases followed by Johor with 33 cases (Hussin, 2016). Among the factors that lead to the increase of title
fraud cases are the hikes in the property price making it attractive to the fraudsters, abandoned the land, and weaknesses in the
registration system at the Land Office, which can be manipulated by criminals. Besides, the inherent weakness of the Malaysian land
law on indefeasibility of title which fails to protect the original proprietor‟s interest when land has been transferred to innocent third
party (bona fide purchaser for value) and the absence of State‟s title assurance fund to compensate the disgruntled original landowner
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also contributes to the increase of title fraud incidences (Othman, 2008). Due to the increase in fraud and the weaknesses of the registration
system in the country, this study aims to analyse this problem further and provide solution to the problem in view of the differences in the land
administration system in Peninsular Malaysia, Sabah and Sarawak.
2.0 Fraud in Title Registration: Modus Operandi
Fraud in land title registration can take many forms and shapes, whether in paper based or electronic land registration systems.
Corruption and abuse of authority for personal financial gain have been attributed as the root of evils (Abraham and Pane, 2016).
Narcissism can also be inferred as a factor contributing to fraud. This is because a narcissist perceives the social life as a series of
struggles for dominance. Thus, they can attack others even though there is no direct threat. They attack others only as a means to put
them in a superior position by conquering, defrauding, or intimidating others (Abraham & Pane, 2016). Forgery of the victim‟s
signature is the most prevalent in the paper-based system. The crime is normally committed by a family member or a relative who
copies the landowner on the instruments of dealing (such as transfer or charge). In some cases, the criminals also forge the signature
of the witness who did not present to attest the execution of the instrument. In the computerised system of land registration, the usual
practice is that the certifiers will sign documents on behalf of their clients digitally. Since individuals no longer sign documents, it would
not be doable for the fraudster to forge the signature of the victim on the instrument. Nonetheless, to allow the certifier to sign the
instrument on behalf of his client, the electronic system typically needs a client authorisation form to be completed and physically
signed by the client and the certifier in front of a witness. Although the forgery of the victim‟s signature on the actual land title
document is virtually impossible, the fraudster may still forge the signature in the client authorisation form. The potential for fraud by
misleading the victim into signing documents in the electronic system is removed because the system does not require the signature
of the land proprietor. Hence it would not be probable to carry out fraud by misleading the victim into signing the necessary
instruments (Low, 2006).
In the paper-based framework of land dealing, lawyers can carry out fraud by forging the victim's signature. In the electronic
system, solicitors who are also certifiers have access to the digital signature certificate to sign documents digitally on behalf of their
clients. It is easier to commit fraud because the solicitor acting as certifier is not required to falsify the victim‟s signature. The solicitor
can prepare the documents, sign it digitally and submit it electronically to the land office for the registration. It seems that the electronic
system presents more opportunities for solicitor fraud to occur (Low, 2006).
Besides, identity fraud can also occur in the paper system. This usually happens when the lawyer is not observant in validating the
identity of the person purporting to deal with the land. When the fraudster has access to the identity documents of the victim, it can be
used by the criminal to commit fraud. Similarly, in the electronic system, identity fraud can be perpetrated if the solicitor is not vigilant
in verifying the identity presented and simply accepts that the person he is dealing with is not a fraudster. In most cases, the criminals
are someone known by the victim thus they can obtain the victim's identity documents easily. However, a stranger can still commit
identity fraud if he steals the identity document of the victim. Thus, while computerisation of the land registration system makes
monumental changes to the current conveyancing practices, the same people currently involved in frauds in the paper system will still
be able to perpetrate fraud but by employing different approaches. The electronic system has distinctive attributes to the paper system
that may give rise to new types of fraud. This primarily concerns the use of digital signature technology to replace the traditional
handwritten signature (Low, 2006).
Besides, fraud by persons who have access to the digital signature can also happen. A fraudulent person with access to the
electronic system can log in to the system using the id and password he obtained, prepares the necessary documentation, sign the
instruments electronically, and submits the application electronically for registration. For instance, a law clerk in a law firm can commit
fraud if he has access to the electronic system. Illegal use of the certifier's digital signature certificate to digitally sign documents is
equivalent to the forgery of the handwritten signature. The only distinction is that in the paper-based system, given a sample-
handwritten signature, anyone can forge the signature but the law enforcement agencies can conduct handwriting analysis to detect
the forgery. In comparison, in the electronic land system, the fraudster cannot commit forgery unless he has access to the digital
signature certificate and the password used to activate the digital signature certificate. However, once he has access to that
information, fraud is easier to commit and harder to detect. Unlike the conventional handwritten signature, biometric or handwriting
analysis is of no use to detect the forgery (Low, 2006).
3.0 Management of Land Registration in Malaysia: Federalism Concept and Its Application
Federalism is a framework whereby there are two levels of the government (Federal and States) which rule the same territory and
people. Each level has areas of action in which it is autonomous, and there is some constitutional guarantee of the autonomy of each
government in its sphere (Flippov et al., 2004). In Malaysia, historically, the Reid Commission was set up to make recommendations
for the establishment of a strong central government with the states and settlements enjoying a measure of autonomy and with the
consultation machinery between the two levels of government (Omar, 2012). One of the vital features of the Federal Constitution is the
division of powers between the federal and state governments. Article 74(1) enables the Parliament to make laws for matters under
the Federal List whereas Article 74(2) empowers the State Legislative Assemblies to enact laws for subjects that fall within the scope
of the State List. According to the State List, land matters are one of the subjects within the competent jurisdiction of the State
Legislature to legislate. Therefore, all land located within the state boundaries are vested in the state. Therefore, the States have the
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jurisdiction over the land. The constitutional arrangement also makes the State the supreme authority of the land administration, not
the Federal Government (Awang, 2003).
Despite land matters being a subject under the State government‟s autonomy, the Parliament had used its power under Article 7 6
of the Constitution, for uniformity, to interfere in land matters. As a result, major land legislation, the National Land Code (hereinafter
referred to as the NLCC) was enacted and came into force on 1st January 1966 for all the states of Peninsular Malaysia. The NLC
was passed with the aim of establishing a unified land system concerning land tenure, registration of titles, and land dealings. The
Code substituted forty-three different land statutes at the federal and state level. The NLC has extensively affected the land tenure
system, land policies, and land development in the country. These changes were initiated with the object of attaining the national
development objectives as provided under the different Malaysian development plans (Awang, 2003).
Besides, federal intervention in land matters is not restricted to its legislative capacity to make laws, but also via federal
administrative agencies such as the National Land Council, the Office of the Director General of Lands and Mines, and the Regional
Development Authority. The National Land Council must advise both the federal and state governments in respect of utilisation of land
and any proposed legislation dealing with land or the administration of any such law. But, since the federal government has no
executive functions and merely possesses an advisory capacity, it has no authority to put into effect its directions to the State (Awang,
2003).
In short, in Peninsular Malaysia, matters concerning registration of title are delegated by the State Land and Mines Department to
the respective land offices at the district level. The Land Offices are primarily accountable for the collection of revenue, title
registration, managing application for land dealings, changing of the condition of land use, subdivision, partition, or amalg amation of
land or building and so on (Tan, 2013). The NLC provides limited powers to the Federal Director General of Land and Mines in matters
relating to land administration. Reforms cannot be implemented in the States without the prior approval of the State Land Director and
consent of the State Authority. These inabilities provide a limited scope for development of experts in land administration and
developing a specific discipline in the land administration in the country. State Directors has the discretion to withhold information or
refuse to cooperate with the Director General of Land and Mines. This situation will hamper the effective implementation and
enforcement Federal Government policies and law that can promote uniformity within the country. However, the Director General of
Land and Mines is not empowered to impose any punitive action on the State that refuses to comply with any policies or law (Ganason
& Maidin, 2010).
In Sarawak, the Land and Survey Department is a multi-functional organisation under the State Ministry of Planning and Resource
Management. The core businesses of the Department involve surveying, land management (including land registry), planning, and
valuation. Land matters in Sarawak are governed by the Sarawak Land Code 1958. Meanwhile, land administration organisational
structure in Sabah share almost the same structure as Sarawak. All matters about land registration, administration of the cadastral
survey and valuations of land premium in Sabah are entrusted to Lands and Surveys Department headed by the Director of Lands and
Surveys. The Lands and Surveys Department is under the portfolio of the Chief Minister‟s Department through the office of the
Secretary of Natural Resources. In Sabah, the Sabah Land Ordinance 1930 applies (Samsudin, 2011).
4.0 Evolution of Registration Process in Peninsular Malaysia, Sabah, and Sarawak
One aspect of comparison between land administration system in Peninsular Malaysia, Sabah, Sarawak, and foreign jurisdictions is
the electronic land administration system employed by the respective jurisdiction. Information and Communication Technology (ICT)
skills are currently of great interest to governments and business (Yusof et al., 2017), and land matters are not excluded. With the
recent economic prosperity, Malaysia is going forward with its vision of becoming a technologically developed country by the year
2020 (Isa et al., 2017). Technology is changing and growing around the globe at a rate and pace never experienced before. The
contribution of new technology to economic growth can only be realised when and if the new technology is widely adopted and used.
Adoption itself results from a series of individual decisions to begin using the new technology, decisions which are often the result of a
comparison between the uncertain benefits of the new invention and the unknown costs of implementing it (Takim et al., 2016). In the
aspects of title registration and land dealing electronic system, in Peninsular Malaysia, e-Tanah system was first introduced in Penang
before it was implemented in Negeri Sembilan and Melaka (Department of Director General of Lands and Mines, 2013). It was
planned to be expanded nationwide, but to date, it has yet to materialise. The e-Tanah System is a computer system and a set of
supporting rules and business practices within a legal framework that provide a reliable means of completing conveyancing and other
land related transactions electronically. These arrangements are intended to replace the existing paper -based processes in the land
administration of the State Land Registries. E-Tanah system was first introduced in Penang before it was implemented in Negeri
Sembilan and Melaka (Department of Director General of Lands and Mines, 2013). e-Tanah provides an electronic environment to
convert paper-based titles which are manually registered to electronic-based titles with bar-coded and electronic authentication of the
Registrar‟s digital signature; and lodge instruments or submission of applications with Land Registries through single point of contact
services and receive confirmation of their lodgment or submission and registration manually or by technological means (Ismail, 2012).
In the Peninsular States that have not implemented e-Tanah system, a system known as Secured Land Management System
(SELAMAT) is in place. It was first implemented in 2010 in Temerloh Land Office and was extended to other land offices in Perak,
Kelantan and Petaling Jaya in 2011 while in 2012, the system was implemented in Pahang, Perlis, Hulu Langat, Klang, Kuala
Terengganu and Kulaijaya. SELAMAT was implemented in the whole of Pahang, Selangor, Johor, and Kedah in 2013 (Pemudah,
2014). In Putrajaya, SELAMAT was implemented on 1 December 2016 (Federal Territories Director of Lands and Mines Office, 2016).
SELAMAT is the abbreviation of “Secured Land Management System” to prevent fraudulent land transactions, which was included in
the computerised land registration system. It was first implemented in 2010 in Temerloh Land Office and was extended to other land
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offices in Perak, Kelantan and Petaling Jaya in 2011 while in 2012, the system was implemented in Pahang, Perlis, Hulu Langat,
Klang, Kuala Terengganu and Kulaijaya. SELAMAT was implemented in the whole of Pahang, Selangor, Johor, and Kedah in 2013
(Pemudah, 2014). In Putrajaya, SELAMAT was implemented on 1 December 2016. This system serves to record fingerprints of
landowners and solicitors to ensure proper and credible operation of land administration in line with the government policy to
modernise land transaction in Malaysia. It is projected that the system will have a positive impact in addressing the issue of fraud in
land administration and increase people‟s trust and confidence in the system (Klang Land Office, 2016). In this system, anyone
dealing with the Registration Unit at the department of lands and mines and district land offices is required to use SELAMAT system
whereby the fingerprints will be recorded to match the MYKAD information. The data will be kept in SELAMAT database and will be
used for future dealings and to detect fraud and forgery (Berita Harian, 2013).
In Sabah, Land Dealing Electronic Submission System (LaDess) provides online digital submission and dealing system (Untong,
2015). The system is a collaboration between the Sabah Law Association (SLA) and the Department of Lands and Surveys, Sabah.
Among the features of the system to ensure security of land dealing and to prevent fraud are such as law firms are required to prepare
and print land dealing application forms, online land dealing status enquiry, SMS notification to customers on completed transactions,
online printout of memo slip, online search on land owners' names and shares as well as registration of land clerks (Mu, 2016 ).
Besides, LaDess is safe to use because it has a high level of security, in compliance with international standards and safe from
hacking. Although there were attempts to by law firms to hack into the system and modify the information, it cannot be modified
because the original document is still in the possession of the department (Oslan, 2016). Meanwhile, Sabah Land Information System
(SALIS) which started in 1997 is a web-based system to integrate all Department of Lands and Surveys‟ digital textual, graphical and
images onto a common platform. Among the early digital data integrated are land titles textual information, land dealings
information, land revenue information, graphical cadastral parcel, orthophotos. It later includes high resolution remotely sensed
images land acquisition information, land value information, cadastral boundaries information etc. (Untong, 2015). The system
includes Sabah Digital Cadastral Data Base (DCDB) which consists of more than 560,000 land parcels in the State (Untong, 2015).
The comprehensive digital cadastral database (DCDB) which uses point entry methodology shall underpin the creation of a „survey-
grade‟ parcel fabric through homogeneous modelling, adjustment, and enhancement. The information-rich enterprise multi-purpose
Cadastre info-structure is capable of supporting dynamic data mining, implementation of diversified land-based applications to serve
specific individual for example land owner, user groups such as surveyors and developers and geospatial communities especially
web/mobile users and so forth. With comprehensive land information of high integrity within reach shall expedite development program
that involves land matters in that, an informed decision can be made in shorter time with reduced bottlenecks. The enterprise info-
structure will substantially upgrade the Department‟s delivery system to become efficient, resourceful, and accurate in rendering
services (Untong, 2014).
In Sarawak, the development of the Land and Survey Information System (LASIS) was initiated to include Title Registration
System (TRS) that provides facilities for speedy processing and registration of land titles, strata titles and land dealings. In ensuring
that LASIS system is effective and reliable, the Department improved it services through registration of land dealings within one day
with automated e-mail notification to inform the legal firms instantly upon registration. Besides, the entirely integrated data sets allow
the information to be made available on demand to facilitate intelligent analysis and reliable decision making (Land and Survey
Department Sarawak, 2016). According to the information obtained from the Department, issuance of circular and policies on LASIS,
use of standard prescribed forms and standard work process are vital in preventing fraud in the system. Regarding the security door
access system of the server room, it is secured, and access is limited. On-site and off-site backup is also available, and title folios are
equipped with security features to prevent forgery. The mirror image of the official register and owner‟s copy is also ensured. Besides,
users of the system are given auto expiry password to control access to the system and prevent unauthorized access. Besides, to
create awareness and detect abuse of the system, the audit is conducted from time to time. Another measure to prevent fraud is to
involve multiple officers with specific limited roles in the electronic registration of land. For instance, the clerk is tasked to receive the
application, make data entry, instrument allocation and the endorsement, and to print menu of the title folio. Then, a checker is
responsible to make data verification and check verification reports and endorsement text for errors. After that, the application is
forwarded to the Registrar who must update the case status and register the dealing. It will then be brought to the operation manager
for system validation. If there is any error, the system will notify the Registrar of the error, and the Registrar must report using Fault
Report Form for trouble shooting by Operation Manager to correct the error.
One of the most important security features of computerised land administration system is controlling access to the system. In
Peninsular Malaysia, under the e-Tanah system, lawyers must register online through the e-Tanah portal where they will be given a
User ID and Password. They can save and edit the NLC Forms before submission. They are also required to have an A3 printer to
print out the NLC Forms. There is also A3 printer facilities at the Land Office for the public. It is pertinent to note that limiting access
only to authorized users would make it easier for the system administrator to supervise and track the usage of the system as well as to
keep up an audit trail of the users in the system. However, this would be more complicated to achieve in a system that is open for all
to use (Ismail, 2012). Meanwhile, as for SELAMAT, anyone dealing with the Registration Unit at the Land Office is required to use
SELAMAT system whereby their fingerprints will be recorded to match their MYKAD. The data will be kept in SELAMAT database and
will be used for future dealings to detect fraud and forgery (Berita Harian, 2013).
In Sabah, the access to Land Dealings Electronic Submission System (LaDESS), access is reserved to legal firms (conveyances).
As an additional security measure, LaDESS allows the firms to restrict user access to the system. For instance, the firm can manage
its profile and specify access as follows: COMPADMIN able to do all function and manage users, including suspending user
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accounts; SUPERUSER able to prepare and submit dealing; and USER able to prepare dealing only (Lands & Survey Department
Sabah & Zuma Engineering, 2010).
In Sarawak, eLodgement module under e-LASIS enables law firms in Sarawak to do online submissions of the full range of
instruments concerning land dealings. The system processes these submissions and will electronically lodge them if they are found to
be in order. Like Sabah, the law firm needs to be registered in the online system. There are four (4) default Public User Groups for
eLodgement. Each user group has been configured with specific access rights to eLodgement submission modules. When the
company or law firm registers to the system, the system shall make a copy of the default user group settings and save it as specific
company user groups. While the administrator can do all function and manage users, including suspending user accounts, the
conveyancer can only prepare and submit dealing. The staff can prepare dealing only and do the prepayment of the legal firm (Sains,
2014).
Another security aspect of the computerised land administration system is the usage of the digital signature by the system.
Malaysian e-Tanah system uses the appropriate technological framework for the use of electronic signatures similar to Singapore.
Under e-Tanah environment, it appears that Land Registry envisages that the electronic signatures will be based on some form of
Public Key Infrastructure. The e-Tanah system uses digital signatures in a PKI environment with DigiCert. To sign documents
electronically, users of e-Tanah system will require a digital certificate, issued by DigiCert. Registration for a Digital Certificate require
the following documents: identification document of applicant (identity card, passport, or work permit for foreigners); photocopy of front
and back of identification document; and DigiCert digital personal certificate application form or for a Corporate DigiCert digital
certificate, a corporate certificate application form (Ismail, 2012).
As for SELAMAT, it relies on biometric and fingerprint information. No mechanism regarding digital signature is available. In
Sarawak‟s e-LASIS, digital certificates (DigiCert) is used to sign PDF documents and to authenticate users before the online
submission for eLASIS applications (Sains, 2014). In Sabah, no digital signature is used under LaDESS as the physical presentation
before the counter at Central Land Registry is still required (Lands & Survey Department Sabah & Zuma Engineering, 2010).
5.0 Conclusion
As shown above, the number of cases concerning title registration fraud in Malaysia is not showing any diminution. This sufficiently
proves that the title registration system in Malaysia is susceptible to fraud. Apart from the inherent weaknesses of the land statutes on
the issue of indefeasibility which leaves original proprietors uncompensated when their lands have passed on to the innocent third
parties and the absence of State-guaranteed title assurance fund as a recourse of remedy for aggrieved original proprietors, as of
date, not much can the land law system can do to protect them. In addition to that, the paper and electronic land registration systems
have been proven to be vulnerable to fraud and new types of cyber crimes too. Although title insurance could be an option to
indemnify against loss or damage arising out of defects in or upon the title to real property, it appears to be unsuitable mechanism in
Malaysia at this point due to the low popularity, rate of subscription and general awareness of general insurance among Malaysians
indicate the high possibility of low acceptance of title insurance, if it were to be introduced in Malaysia. On top of that, if title insurance
is made compulsory, it will indicate non-confidence, insecurity and unreliability of the land administration system and gives a negative
perception of the investors and the people about the government‟s ability to provide a safe and secure land management system .
Therefore, extra efforts need to be undertaken to ensure that the registration system is secure, safe, reliable and fraud-proof. This
paper suggests that the security of the systems need to be tightened to diminish fraud. Audit trail needs to be conducted on the more
frequent basis to detect any abnormalities in the systems. Besides, control on access to the system must also be tightly regulated.
Specific officers should be allowed to do specific tasks in the system and involvement of multiple officers is a good way to prevent
insider‟s fraud. As suggested by Yakob et al. (2016), it is important for the government to conduct relevant training for the officers
involved and make improvements regarding its effectiveness. Additionally, the government should find ways to increase financial
resources to employ more staff to carry out the relevant functions. Shibata et al. (2017) suggest that the government should review its
crime prevention strategies to make it more effective and sustainable. An evidence-based approach is needed in implementing and
supporting crime prevention strategies, especially concerning title registration fraud. According to Ismail et al. (2012), essentially there
is a need for changes in the organisational culture in the aspects of physical changes, such as organisational structure, management
systems, policies and procedures, action plans, short-term budgets or resource allocation, and information system. Besides, changes
must also be made on the behaviour, such as values given to quality, excellence, communication, innovation, and employee
participation. As of now, problems such as limited availability of the necessary equipment and facilities need to be resolved (Daud et
al., 2016). Besides, strict registration requirements as applied in Sabah and Sarawak should be adopted in Peninsular Malaysia.
Finally, it is also recommended that the physical appearance of the registered proprietor should be made compulsory. To date, 5th
Schedule of NLC does not make the owner‟s appearance compulsory as he can sign the instruments in front of lawyer or land
administrator. This is one of the weaknesses that need to be corrected by the land system. Besides, due to the application of
indefeasibility concept in Peninsular Malaysia and Sarawak, it is also time to consider title assurance fund as compensation to the
owner whose title has passed to the bona fide purchaser for value, without the fault of the owner. In Canada, Australia, and Singapore,
the source for the fund is typically financed in part by levies and fees on dealings, caveats and withdrawal of caveats lodged under the
land statute and shortfalls are met from the government‟s coffer. The need to incorporate the fund into the land system may in a way
enhance integrity by having an accurate Register of Titles and provide additional efforts to combat fraud and forgery of documentation.
Besides that, this effort shall also increase public and investor‟s confidence and support in the Malaysian land administration system
(Ismail et al., 2013). Consumer knowledge and legal awareness also need to be raised (Ismail et al., 2016). This is an important
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measure so that the public can avoid becoming preys to title registration fraud. As implied by the study of Prayoga et al. (2016),
intervention is a viable preventive mechanism to legal problems. This paper recommends that the government intervention to pr event
fraud is of the utmost importance.
Acknowledgements
The authors thank the National Institute of Valuation for sponsoring this research under the National Real Estate Research
Coordinator (NAPREC) fund and the Research Management Centre, Institute of Research Management & Innovation (IRMI),
Universiti Teknologi MARA for managing this grant under the project code 100-IRMI/GOV 16/6/2 (0022/2016).
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... It can even be followed by certificate duplication and/or certificate forgery, or other combinations of actions known as fraud. Fraud in the title register often creates concern for house owners as it is a breach of property rights (Abdullah et al., 2017). Among the most common occurrences is the falsification of: original court order, identification card, issue document of title (IDT), power of attorney, signature, and transfer form (Form 14A), besides impersonating as an estate agent or as an occupant. ...
... Among the most common occurrences is the falsification of: original court order, identification card, issue document of title (IDT), power of attorney, signature, and transfer form (Form 14A), besides impersonating as an estate agent or as an occupant. Abdullah (2017) in her article has concluded that the number of cases concerning fraud involving title registration in Malaysia is not showing any decline. She surmises that it sufficiently proves that the title registration system in Malaysia is susceptible to fraud. ...
... This would present a negative impression to investors and the public about the government's capacity to have a stable land management system. Therefore, additional care should be taken to ensure the application process is safe, secure, and accurate (Abdullah et al., 2017). ...
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... However, security breaches of land tenure are still rampant in Malaysia. In the paper "Land Registration of Titles at Stake: West and East Malaysia Compared", Nuraisyah et al. [24] provided solutions to address the weaknesses of the registration system in Malaysia. In the paper, the emphasis is placed on two domains. ...
... Nuraisyah et al. [24] stated some factors that lead to fraud cases in Malaysia. Among them are the high-priced property that motivates the fraudsters, land abandonment, weaknesses in the registration system which open space to the falsification of documents and inherent weaknesses of the Malaysia land legislation. ...
... Improvement has to be done to strengthen the land registration security. Among them are the regularly conduction of audit trails to detect abnormalities in the systems, conduction of specific training to improve effectiveness of the administrators and the adaptive changes in the organisational structure, policy and management system with respect to the current need in land management [24]. ...
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... This proves the injustice of the current system judgment on the innocent purchaser. Abdullah et al. [15] conducted a study on indefeasibility and the concept of federalism in Malaysia's land administration system. From their study, they found an increasing number of cases regarding title registration fraud in Malaysia. ...
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... On the other hand, many citizens tend to suffer from fraud. Because of the rising number of fraud and the poorness of the registration system in the country, the current research has the objective of providing a solution to the mentioned issue [3]. ...
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