Let's talk about seller impersonation fraud

Fraud is certainly a subject we don’t love, but it’s necessary to keep it on our radar. Why? Because our transactions can always be a target, and it’s key for everyone involved to stay vigilant when it comes to these cybercriminals. Knight Barry Title is constantly working to combat wire fraud, but there’s a different kind of scam going around you should know about right now: fraudsters impersonating an owner and trying to sell a property they don’t own.
While this message is mostly for our real estate partners, homeowners should also be aware of this danger, especially if they own a vacation home or other secondary residence which isn’t always occupied. Vacant lots are a prime target, too. These scams have even caught the eye of the U.S. Secret Service, which issued this joint bulletin with our friends from CertifID. The latter is a company Knight Barry Title works with to help make your transactions more secure. Tom and the rest of the team are truly industry leaders when it comes to this topic.
The good news, if you can call it that, is that these scenarios have been getting some news coverage. Florida properties and other vacation spots have proven to be popular targets so far, but all of us should be aware of them. Here are some signs you might be getting duped:
  • “Seller” only makes contact via email or text and makes excuses on why they can't talk on the phone, show up in person or appear virtually.
  • “Seller” demands a quick sale and either insists on a low asking price or is willing to take a lowball offer.
  • “Seller” doesn't have proper identification.
  • “Seller” tries to use their own notary (the “notary” of course is part of the fraud)
  • “Seller” offers incentives or is willing to cut corners for a quicker closing. 
It’s important to remember things are rarely too good to be true, and it’s always good to have your guard up. When things seem off, they usually are. Here are just a few recent seller impersonation attempts from across the country:
  • A title agency in North Carolina reported a loss of $33,000 to CertifID from a vacant lot transaction. The title agency and the real estate agent were scammed by an imposter seller. Luckily, it was reported quickly, and CertifID was able to work with the U.S. Secret Service to freeze and return the funds.
  • A title company customer in Ohio followed the playbook to stop seller impersonation fraud almost perfectly. The “seller” of a vacant lot contacted the real estate agent online and the Realtor listed the property for sale. The “seller” was very pushy about transferring money and the amount they’d make. The seller claimed to owe more than the $30,000 sale value and was anxious to receive the funds Luckily, due to all of these red flags, the title company identified the fraud and stopped it in time.
  • Another title company in Florida avoided a sizable $110,000 fraud loss. A “seller” living in Vermont contacted a real estate agent online to list a vacant lot and the agent listed the property and secured a signed offer. But when the agent involved the title company the title company identified red flags as the “seller” asked to use their own notary due to being out of state.
Knight Barry Title’s leadership is working hard to talk about this kind of fraud in Wisconsin, in Florida and all across our national footprint. We’ve talked to Realtor groups and others directly and believe this is an issue everyone needs to know. If you and your brokerage or company are interested in learning more, please contact your local Knight Barry Title agent. Thank you for trusting our KBT people to deliver success for you during every transaction.