In exchange for a loan to pay off their debts, many Portuguese families have ended up losing their homes.
Homeowners have been signing documents that they think are mortgages but in fact these are contracts of purchase and sale.
Companies, some displaying no address or company registration number, have been advertising on the web and in newspapers to attract people that are facing mounting consumer debts but who own their own properties outright.
The companies come over as 'private investors' with the ability to lend money to indebted families.
As security, a purchase and sale agreement is signed for the total value of the family debts, with many families being duped into thinking that this is a mortgage.
Then a second lending contract is made, which allows the family to stay in the house and repurchase it after a certain time. However, the monthly amounts to be paid out are way above the family income, on purpose.
The lease or lending agreement allows the family to stay in the property for one or two years and states that the former owner can repurchase the property within a certain time - but at a significantly higher value, normally at least 30%.
Any payment default sees the family losing their right to live in the property.
The Attorney General's Office says that victims can file a complaint at any Public Prosecutor's Office with "a view to opening an investigation."
The Bank of Portugal, as regulator, has acknowledged that it "knows about these fraudulent practices."
These companies change their name frequently, with today’s Público naming Multibiz and Credipoupa.
