A Philippine Legal Article

In the Philippines, land fraud often happens not because documents look obviously false, but because they look convincingly official. A title may carry a seal, signatures, technical descriptions, tax declarations, and even a clean-looking chain of ownership, yet still be defective, forged, cancelled, overlapping, or legally useless. The safest rule is simple: never rely on the seller’s copy alone. A land title must be verified against official land records, property history, actual possession, and the legal status of the property.

This article explains, in Philippine legal context, how to verify a land title, how fake or double titles happen, what warning signs to watch for, and what legal remedies may apply.

1. The basic legal framework of land titles in the Philippines

Philippine real property rights are governed mainly by the Civil Code, the Property Registration Decree (Presidential Decree No. 1529), the Public Land Act, related land registration laws, and administrative rules of the Land Registration Authority (LRA), Registry of Deeds (RD), Department of Environment and Natural Resources (DENR), and local government units.

The core idea is this:

A certificate of title is the government’s official evidence of ownership over registered land. In practice, titles commonly appear as:

Original Certificate of Title (OCT) – usually the first title issued over a parcel after original registration or certain government grants.
Transfer Certificate of Title (TCT) – issued after transfer from a prior registered owner.

For condominium units, the equivalent document is usually a Condominium Certificate of Title (CCT).

A genuine title, however, is not automatically a valid title in every sense. There are at least four different questions:

Is the paper itself authentic?
Does it match the Registry of Deeds record?
Is the seller really the registered owner with power to sell?
Is the title free from legal defects, adverse claims, overlaps, or prior cancellations?

A buyer must answer all four before proceeding.

2. What “title authenticity” really means

When people ask whether a title is “real,” they often mean one of several different things:

A. The document is physically genuine

The certified or owner’s duplicate title is not a fabricated printout or altered copy.

B. The title exists in the Registry of Deeds

The title number appears in the official records and corresponds to the same land, same owner, and same annotations.

C. The title is legally effective

It has not been cancelled, superseded, nullified, or undermined by fraud, court order, overlapping claims, or prior title defects.

D. The title covers the land actually being sold

The metes and bounds, location, lot number, survey plan, and technical description truly correspond to the property on the ground.

Many fraud victims verify only item A, but not B, C, or D.

3. Why fake, forged, or double titles happen

Land title fraud in the Philippines usually arises through one or more of these patterns:

A. Forged owner’s duplicate titles

The title shown by the seller is fabricated or altered. Fraudsters may change the owner’s name, title number, area, or annotations.

B. Fake deeds and fake notarization

A forged deed of sale, donation, extra-judicial settlement, or special power of attorney may be used to transfer the property without the real owner’s consent.

C. Double sale

The same property is sold to two buyers. In Philippine law, this can create a dispute over who has the better right, depending on registration, possession, and good faith.

D. Double titling

Two titles appear to cover the same land, either fully or partly. This may result from fraud, administrative error, overlapping surveys, or successive registration irregularities.

E. Reconstituted or replacement titles used as tools of fraud

When titles are allegedly lost, burned, or destroyed, fraudsters may try to use reconstitution proceedings or replacement processes to create a false appearance of legitimacy.

F. Overlapping technical descriptions

A validly existing title may overlap another title or actual occupied land because of survey errors, falsified plans, or registration mistakes.

G. Sale by heirs without proper settlement

Heirs may sell property before estate settlement, or one heir may sell the whole property without authority from the others.

H. Sale of property under legal restriction

The land may be mortgaged, under adverse claim, subject to lis pendens, covered by agrarian restrictions, tied to ancestral land claims, or otherwise encumbered.

I. Sale by impostors

The “owner” may simply not be the owner at all, even if the title shown appears genuine.

4. The governing principle: registration matters, but good faith matters too

Under Philippine land registration law, registration gives strong protection to the registered owner and to buyers in good faith dealing with registered land. But this protection is not absolute.

A buyer cannot shut his eyes to suspicious circumstances and later claim good faith. If the situation contains clear red flags—mismatched identity documents, occupants other than the seller, suspiciously low price, altered title pages, missing tax records, inconsistent lot boundaries, prior notices on the title—a court may find that the buyer was not in good faith.

The doctrine of innocent purchaser for value protects those who buy for valuable consideration, in good faith, and without notice of defects. But it does not protect a buyer who ignored facts that should have led to deeper inquiry.

In practice, the more suspicious the transaction, the higher the buyer’s duty to investigate.

5. The first rule: distinguish the owner’s duplicate from certified official records

The seller usually presents an Owner’s Duplicate Certificate of Title. That document is important, but it is never enough by itself.

The safer legal approach is to compare it against:

Certified true copy from the Registry of Deeds
The title verification or record confirmation process through official land records
The technical description and survey records
Tax and possession records
The seller’s identity and authority

The owner’s duplicate is only one piece of evidence. The controlling government record remains the official title record.

6. Step-by-step: how to verify land title authenticity in the Philippines

Step 1: Get a certified true copy from the Registry of Deeds

This is the single most important first step.

Request a certified true copy of the title from the Registry of Deeds where the property is located. The purpose is to confirm:

title number
registered owner’s name
lot number
location
area
technical description
annotations
whether the title is active, cancelled, or superseded

You are checking whether the seller’s document matches the RD’s official records exactly.

What to compare

Compare the certified true copy against the seller’s owner’s duplicate:

title number
owner’s name spelling
civil status
lot number and survey plan
area in square meters
technical description
transfer history or memorandum entries
encumbrances and annotations
page quality and consistency

Any inconsistency must be explained before proceeding.

Step 2: Examine the annotations carefully

Many buyers look only at the owner’s name. That is not enough. The annotations are often where the real legal risks appear.

Check whether the title bears any of the following:

mortgage
adverse claim
notice of lis pendens
levy on attachment
levy on execution
notice of pending case
right of way or easement
restrictions on alienation
usufruct
lease
court order
affidavit of loss and issuance of new duplicate
reconstitution notation
consolidation of ownership
cancellation entries

An apparently “clean” title may not actually be clean if the annotations show legal burdens. A title with no annotation does not automatically mean there is no problem, but annotations often reveal serious issues immediately.

Step 3: Confirm whether the title is still valid or already cancelled

Some fraudsters show an old title that was once valid but has already been cancelled and replaced by another TCT.

A buyer should verify whether:

the title is still active
the title was already cancelled
a newer title has been issued
the property has been subdivided
the lot has been consolidated with another property
part of the property has been transferred out

A title can look genuine yet be useless because it no longer represents current ownership.

Step 4: Verify the technical description and lot identity

A common mistake is assuming that the address or local description of the property is enough. In law, the property is identified by its technical description, lot number, and survey references.

Check:

lot number
block number, if applicable
survey plan number
municipality/city and province
area
bearings and distances
boundaries with adjoining lots
whether the land described matches the property being shown

This matters because fraud sometimes involves showing one parcel on the ground while presenting the title for another parcel nearby.

Step 5: Check the survey plan and cadastral identity

The title should be consistent with the corresponding survey plan and land records. Overlaps, wrong boundaries, and false claims often appear here.

The buyer should verify whether:

the survey plan exists
the plan number matches the title
the lot is correctly plotted
the parcel overlaps another titled lot
the land lies within alienable and disposable land, where relevant
the boundaries fit actual occupation

This is especially important for raw land, large parcels, provincial properties, old titles, and land that has not been fenced clearly.

Step 6: Physically inspect the property

Philippine jurisprudence places importance on facts that should put a buyer on inquiry. One of the strongest warning signs is actual occupation by people other than the seller.

On inspection, check:

who is in possession
whether there are houses, tenants, caretakers, farmers, informal settlers, co-heirs, or adverse possessors
whether the lot boundaries on the ground match the title
whether the neighboring owners recognize the seller’s claim
whether there are markers or monuments
whether the area stated in the title appears grossly inconsistent with the property shown

A buyer of land in good faith is generally expected to investigate when someone other than the seller occupies the property.

Step 7: Verify tax declarations and tax payment history

A tax declaration is not proof of ownership in the same way a title is. Still, it is useful supporting evidence.

Check:

current tax declaration
prior tax declarations
real property tax receipts
whether the declared owner matches the titled owner
whether tax payments are updated
whether the property classification is residential, agricultural, commercial, etc.

Inconsistency between title and tax records is a red flag. Nonpayment of taxes is not conclusive proof of fraud, but it may signal neglect, dispute, or lack of possession.

Step 8: Verify the seller’s identity and marital status

Even a genuine title can be used in a fraudulent sale if the person signing is not the real owner or lacks authority.

Check government IDs and compare them with the title and tax records. Confirm:

full legal name
signature consistency
date of birth
citizenship if relevant
marital status
spouse’s identity
whether the seller is alive
whether the seller is personally appearing

Why marital status matters

If the property belongs to the absolute community or conjugal partnership, the spouse’s consent may be required. A sale signed by only one spouse may be void or voidable depending on the circumstances and property regime.

If the registered owner is “married to” a named spouse, that must be taken seriously. The spouse may need to sign.

Step 9: Verify authority if the seller is not the registered owner

The sale is riskier when the signatory is an attorney-in-fact, heir, corporate officer, guardian, administrator, or representative.

Require proof of authority such as:

Special Power of Attorney
board resolution or secretary’s certificate for corporations
letters of administration
extra-judicial settlement
court order
guardian appointment
trust document, where relevant

Then verify whether that authority is genuine, specific, notarized where required, and still valid.

A forged SPA is a common fraud instrument.

Step 10: Check the notarial details of deeds and instruments

In Philippine practice, forged or irregular notarization is a frequent indicator of fraud.

Review the deed or authority document for:

complete names and personal details
competent evidence of identity
proper acknowledgment
page consistency
no obvious insertions or erasures
proper notarial seal and register details
date and place of notarization
consistency between signatories and presented IDs

A notarial defect does not automatically mean the whole transaction is void, but serious irregularities are major danger signs.

Step 11: Investigate the chain of title, not just the current title

A clean current TCT may still be vulnerable if it came from a fraudulent prior transfer.

Examine how the seller acquired the property:

sale
inheritance
donation
judicial settlement
foreclosure
corporate transfer
original registration
emancipation or agrarian award
government grant

Then ask:

Was the prior transfer plausible?
Was the prior owner real and capable of conveying title?
Were estate and inheritance documents proper?
Did the title arise from a suspicious reconstitution?
Was there a sudden recent transfer before resale?
Was the property transferred multiple times in a short period?

Rapid transfers are not automatically fraudulent, but they deserve closer scrutiny.

Step 12: Check for court cases, adverse claims, or pending disputes

A title may appear intact while litigation is already underway.

The danger signs include:

seller mentioning “minor family issue”
occupants claiming inheritance rights
neighbors disputing boundaries
ongoing ejectment or ownership case
annotations of lis pendens or adverse claim
prior threats of cancellation or nullification
estate disputes among heirs

Litigation can dramatically change the risk profile of a purchase.

Step 13: Be cautious with reconstituted, replacement, or “lost duplicate” situations

Lost-title scenarios are not automatically fraudulent, but they are high-risk.

If the seller says the owner’s duplicate was lost and replaced, or that the original records were burned or destroyed, investigate carefully. Reconstituted titles and replacement duplicates require strict legal compliance. Fraud has historically occurred through false loss, false reconstitution, and misuse of court or administrative processes.

Extra caution is needed where:

the title is very old
records are incomplete
the owner’s duplicate was recently reissued
the chain of title depends on reconstitution
the seller pressures immediate payment because of “record issues”

7. Hallmarks of a fake title

A fake title is not always easy to detect visually, but common warning signs include:

A. Mismatch with Registry of Deeds records

The most decisive sign is when the seller’s title does not match the RD certified true copy.

B. Altered entries

Watch for overwritten names, erasures, inconsistent fonts, spacing anomalies, alignment problems, or irregular page formatting.

C. Wrong or suspicious title number pattern

An odd title number, missing volume/page references in older titles, or number formatting inconsistent with the property’s location may signal fraud.

D. Wrong paper or print quality

Very sharp modern print on a supposedly old document, blurred seals, inconsistent watermarking, or suspicious paper texture can be warning signs.

E. Inconsistent technical description

The title may refer to a lot number, area, or location different from what the seller claims.

F. Missing annotations where there should logically be some

For example, a recently inherited property with no traceable transfer basis, or a mortgaged property being sold as totally clean.

G. Owner identity mismatch

The name on the title differs from the seller’s IDs, tax declarations, or supporting documents.

H. Seller refuses RD verification

Anyone refusing independent verification is a major risk.

8. What double titles are

A double title refers to a situation where two certificates of title appear to cover the same parcel or overlapping portions of land.

This can happen through:

fraudulent second registration
erroneous technical descriptions
overlapping surveys
administrative mistakes
conflicting original registrations
reconstitution abuses
old cadastral or public land errors
conflicting transfers from a common source

Double titling is especially dangerous because each claimant may possess official-looking documents.

9. How to detect double titles

A buyer should suspect double titling when:

neighbors claim they also have a title over the same lot
boundaries are disputed despite a title
survey plotting shows overlap
the Registry of Deeds record has unusual cancellation or notation history
there are duplicate lot descriptions under different title numbers
actual possession on the ground strongly contradicts the seller’s version
a prior owner’s descendants claim an older title still exists
adjoining owners mention old registration conflicts

The practical method

To detect double titles, compare:

the present title’s technical description
prior titles in the chain
neighboring lot titles, when relevant
survey plans and cadastral maps
actual possession and boundary monuments

Double title problems often cannot be detected by looking only at one title in isolation.

10. Which title prevails in double-title situations?

There is no one-line answer that resolves every case, but Philippine legal treatment generally examines:

which title came first
whether one title was validly issued
whether one title is void from the beginning
whether there was overlapping registration
whether one claimant is in good faith
the source of each title
whether the land was still registrable when the later title was issued
whether the earlier title was cancelled or remained subsisting

In many disputes involving the same land, the earlier valid title has superior weight, especially if the later title should not have been issued at all. But the legal outcome depends heavily on the specific registration history and whether one of the titles is void.

A void title does not become valid merely because it exists on paper.

11. Fake title versus void title versus voidable transaction

These are different legal problems:

Fake title

The document itself is fabricated or materially altered.

Void title or void transfer

The transfer is legally nonexistent or invalid from the start, such as where there was forgery or no authority to transfer.

Voidable transaction

The transaction may be valid until annulled, depending on defects like vitiated consent or incapacity in some cases.

This distinction matters because remedies and evidentiary burdens differ.

12. The effect of forgery on land transfers

Forgery is one of the gravest defects in land conveyancing.

As a rule, a forged deed conveys no title from the true owner because a forged signature is a nullity. However, once a fraudulent transfer enters the registration system, later disputes can become highly technical, especially if subsequent buyers claim good faith and value. The analysis may turn on whether the true owner was negligent, whether an innocent purchaser intervened, and how the registration unfolded.

Still, no buyer should assume that a notarized deed is genuine merely because it looks formal. A forged deed can be notarized on paper and still be legally worthless.

13. Double sale under Philippine law

A property may be sold twice by the same seller to different buyers. Philippine law on double sale gives priority depending on the type of property and circumstances.

For immovable property, the general rule is that ownership belongs to the buyer who in good faith first recorded the sale in the Registry of Property. If there is no registration, priority may depend on possession in good faith; absent both, on the oldest title in good faith.

This means registration is powerful, but good faith remains essential. A buyer who knew of a prior sale cannot benefit from the rule on priority.

So even where the seller presents a title, the buyer must still investigate whether the property has already been sold, occupied, or conveyed.

14. Why actual possession is legally significant

One of the most dangerous assumptions in Philippine real estate practice is: “The title is clean, so possession doesn’t matter.”

That is wrong.

When land is visibly occupied by another person, a prudent buyer must investigate that occupant’s rights. Occupation may signal:

tenancy
lease
co-ownership
inheritance dispute
prior sale
adverse possession claim
agrarian issue
caretaker arrangement
boundary encroachment

Failure to ask can destroy a later claim of good faith.

15. Special caution for inherited property

Properties coming from inheritance require particular care. Watch for these issues:

title still in the decedent’s name
no estate settlement
only one heir selling the whole property
minors among heirs
missing extrajudicial settlement publication, where relevant
unpaid estate taxes or transfer requirements
forged waivers among siblings
omitted compulsory heirs

A sale by one heir may transfer only that heir’s hereditary share, not the whole property, unless the estate has been properly settled and authority is complete.

16. Special caution for agricultural, public, or agrarian land

Not all titled property is freely transferable in practice. Extra attention is needed where the land may be:

agricultural
covered by agrarian reform
derived from public land grant
subject to emancipation or CLOA-type restrictions
forest land or otherwise non-alienable if title origins are doubtful
within ancestral domain or indigenous claims
coastal or environmentally regulated

The mere existence of a document labeled “title” does not automatically cure all defects in the origin or legal classification of the land.

17. Common red flags that should stop a buyer immediately

The following are classic danger signals:

The seller rushes the sale and discourages independent verification.
The price is far below market value without credible explanation.
The seller cannot produce clear identification or appears to be using multiple names.
The title copy differs from the certified true copy.
The property is occupied by others who challenge the sale.
The seller says the title was “just reissued” after loss.
The technical description does not match the property visited.
The seller relies heavily on tax declarations but is vague about the title.
The title carries adverse claims, lis pendens, or suspicious notations.
The seller is an heir, agent, or representative with weak or unclear authority.
The deed or SPA has irregular notarization.
The title history shows fast successive transfers.
The seller refuses to allow direct checking with the Registry of Deeds.
Neighbors say there is a family dispute or another claimant.
The title seems genuine, but the registered owner is deceased and the “seller” is not clearly authorized.

Any one of these may justify suspending the transaction. Several together usually mean severe risk.

18. Best evidence to gather before buying

Before paying earnest money or signing a deed, the prudent buyer should assemble a documentary file including:

certified true copy of title from RD
copy of owner’s duplicate title
latest tax declaration
latest real property tax receipts
seller’s valid IDs
marriage certificate or proof of civil status where relevant
SPA or corporate authority if applicable
deed history or prior title references
survey plan and technical description
proof of possession or turnover arrangements
clearance on occupants and boundary issues
copies of annotations and supporting documents
estate documents if inherited
mortgage release if previously encumbered

The point is not merely to collect papers but to make sure they are consistent with one another.

19. What a buyer should never do

A buyer should never:

rely only on photocopies
rely only on the seller’s word
pay in full before title verification
ignore occupants
treat tax declarations as equivalent to title
accept an SPA without examining authenticity and scope
skip checking marital status
ignore annotations
buy because “the broker says it is clean”
assume notarization equals truth
assume old possession equals ownership
assume a title is valid because it has a seal and red ribbon-like appearance
accept “lost title” explanations casually
proceed while waiting for “small issues” to be fixed after payment

20. Registry verification versus true ownership

It is crucial to understand the limit of title verification.

Even if the Registry of Deeds confirms that a title exists and matches the seller’s copy, that alone does not always settle ownership conclusively. A title may still be attacked if:

it arose from forgery
it was issued over non-registrable land
it overlaps a prior valid title
it resulted from void proceedings
it is subject to pending cancellation
the seller acquired it through a null transfer

So verification is necessary, but not sufficient. It must be paired with legal due diligence.

21. What to do when two people claim the same titled land

When confronted with competing claimants:

Do not pay or proceed with transfer.
Obtain certified title records and prior title references.
Compare technical descriptions and plot the lots.
Determine who is in possession and why.
Review deeds and supporting authority.
Check for cases, annotations, and cancellation history.
Examine whether one title is earlier and validly sourced.
Preserve all communications and documents.

Competing claims often require litigation or administrative action. A buyer who pushes through despite obvious conflict risks being treated as a buyer in bad faith.

22. Remedies if you discover a fake or double title

The available remedies depend on the defect and timing, but may include:

A. Refusal to proceed with the transaction

If the defect is discovered before sale, the safest remedy is non-purchase.

B. Demand for return of payment

If money was already paid, civil claims for rescission, annulment, recovery of sum, or damages may arise depending on the stage and documents.

C. Action to annul deed or title

A forged deed or void transfer may justify a court action for declaration of nullity, cancellation of title, reconveyance, and damages.

D. Reconveyance

Where property was wrongfully transferred, an action for reconveyance may be proper in some cases.

E. Cancellation of annotation or title

If the title or notation is spurious or void, judicial relief may be sought to cancel it.

F. Criminal complaint

Forgery, falsification, estafa, use of falsified documents, and related offenses may apply where warranted.

G. Administrative complaints

If the fraud involved notarial abuse or public officer misconduct, administrative remedies may also be considered.

The correct remedy depends on whether the document is fake, the transfer is void, the title overlaps another, or the property was doubly sold.

23. Prescription and delay: why speed matters

Land disputes can become harder over time. Delay may cause:

further transfers to subsequent buyers
new mortgages
difficulty locating witnesses
loss of records
stronger good-faith defenses by later transferees
prescription issues for some causes of action
laches arguments

Prompt legal action is often critical once fraud is discovered.

24. The special danger of “clean title” language in advertisements

In Philippine real estate practice, “clean title” in a listing usually means only that the seller claims the title has no encumbrance. It is not a legal certification.

A “clean title” advertisement does not guarantee:

authenticity
valid transfer authority
absence of heirs
absence of prior sale
no overlapping claims
no pending case
no tax or boundary issues
no forged underlying documents

A title can be marketed as “clean” and still be the center of a serious legal problem.

25. Title versus tax declaration: the legal difference

This distinction is fundamental.

A certificate of title is primary evidence of registered ownership.

A tax declaration is mainly for taxation and is not conclusive proof of ownership. It may support a claim of possession or claim of right, but it is weaker than a title.

Fraudsters sometimes present:

tax declarations only
old Spanish-sounding documents
survey papers without title
barangay certifications
affidavits of ownership
tax receipts alone

None of these is a substitute for a valid certificate of title when the property is supposed to be registered.

26. Why old titles deserve extra scrutiny

Older titles are not inherently defective, but they may pose special problems:

hard-to-read entries
missing supporting records
reconstitution history
changed cadastral references
old survey methods
boundary shifts over time
overlapping later developments
multiple successions and unrecorded heirship issues

The older the title, the more important it is to verify the chain, surveys, and present legal status.

27. Buyer in good faith: what courts usually expect in practice

A prudent buyer of Philippine land is generally expected to do more than glance at the title. Good faith usually requires reasonable care such as:

checking RD records
examining annotations
inspecting the land
asking about occupants
checking identity and authority
investigating obvious irregularities
not ignoring suspiciously low price or rushed timing

Good faith is not passive innocence. It is careful honesty.

28. Practical checklist for verifying authenticity before buying

A legally prudent pre-purchase review usually includes these minimum actions:

Document check

Get certified true copy from RD.
Compare with owner’s duplicate.
Review annotations.
Confirm the title is active and uncancelled.

Identity and authority check

Confirm seller identity.
Confirm spouse consent if needed.
Verify SPA or corporate authority if applicable.
Review notarization.

Property check

Inspect actual possession.
Compare lot boundaries and technical description.
Verify survey plan and area.
Check neighboring claims.

Record consistency check

Compare title with tax declaration and tax receipts.
Review chain of transfers.
Check inheritance documents where relevant.
Investigate any case, dispute, or adverse claim.

This level of diligence is often what separates a secure purchase from years of litigation.

29. Practical checklist for detecting fake or double titles

Watch for these combined indicators:

title copy does not exactly match RD certified copy
title appears active on paper but is already cancelled in records
seller is not the registered owner and authority is weak
occupants dispute the seller’s rights
technical description points to another parcel
survey plot indicates overlap
there is a prior or parallel title over the same land
deed history shows improbable transfers
reconstitution or lost-title narrative is unclear
family members, neighbors, or heirs contradict the seller’s story

Double-title cases often reveal themselves only after both documentary and ground verification.

30. Legal consequences for buyers who skip due diligence

A buyer who fails to investigate may face:

loss of purchase price
inability to register the deed
cancellation of title acquired
eviction or inability to take possession
long litigation
damages claims
criminal exposure if knowingly complicit
denial of innocent-purchaser protection

In land cases, negligence is expensive.

31. Final legal position

In Philippine law and practice, verifying land title authenticity is not a single act but a layered legal investigation. A title may be physically genuine yet legally defective; officially recorded yet already cancelled; apparently clean yet burdened by hidden dispute; valid on its face yet applied to the wrong parcel; or supported by papers but defeated by forgery, overlapping claims, or lack of authority.

The safest legal approach is to treat every title verification as involving four separate inquiries:

Is the title document authentic?
Does it exactly match the Registry of Deeds record?
Is the seller the true and authorized person to convey ownership?
Does the title validly and exclusively cover the actual land being sold, free from superior conflicting rights?

A buyer who checks only the paper, but not the records, authority, technical description, possession, and conflict history, has not really verified the title.

In the Philippine setting, fake titles and double titles are best prevented not by trusting appearances, but by insisting on official verification, documentary consistency, physical inspection, and rigorous legal due diligence before any payment or transfer.