British authorities are investigating alleged scams in which thousands had been lured into buying overpriced properties in the hope of reaping bounty rentals, a newspaper reported Sunday.

The buyers are feared to have been cheated and lost their life savings.

The buy-to-let scams also cost several government-owned banks such as Northern Rock, Royal Bank of Scotland and Bradford & Bingley millions of pounds in mortgage loans.

The Sunday Times cited officials from the Serious Fraud Office (SFO) as saying that thousands of people who sought to cash in on the buy-to-let dream during the boom years of 2004 to 2007 may turn out to have been victims of organized fraud.

The SFO said it was investigating two alleged buy-to-let frauds. Police in Greater Manchester, the West Midlands, and West Yorkshire also started probe into the case.

One of the firms involved was Morris Properties, which was established by local developer Simon Morris and specialized in students' apartments and refurbished homes in Leeds and the northeast.

The company sold 1,000 properties before going bust last summer and earned 69 million pounds (about 104 million U.S. dollars) by selling buy-to-let properties.

Morris' firm lured investors with promises of substantial "discounts" on flats that were allegedly overpriced, and guaranteed rental income, which often failed to materialize.

Last week, Morris was accused by lawyers representing 133 of his former clients of overseeing a scheme in which flats were sold for as much as 100 percent above their real value.