[00:00:00] Speaker A: Foreign hello and welcome back to the Bottom Line Me podcast. I'm your host, Ann Allard. Happy to have you join us today. Today we're going to talk about seller impersonation fraud. I think we all know that seller impersonation fraud is a growing and an increasingly sophisticated state scam that often possesses significant risks to property owners.
These types of frauds can lead to months of legal hassles, extensive title work and thousands of dollars that have to be paid out. I'm sorry, I got to do that again because my screen just went blank.
These types of fraud can lead to months of legal hassle, extensive title work and fun, thousands of dollars in costs to both property owners and potential buyers. Sometimes as real estate professionals, we often serve as the first line of defense, but there are also some proactive steps that sellers and buyers can take to protect themselves. I'm delighted to have Joining me today to share her insight on this topic is my sometimes co host, Brenda Nelson. Some of you may recall that Brenda previously came on the podcast with and talked with us about seller impersonation fraud when it was first making headlines. So she's back today to give us some updates and perhaps share some new perspective or some new tips on ways to.
Let me say that again. So she's back again today to bring us up to date on what's been going on with seller impersonation. Brenda, welcome.
[00:01:51] Speaker B: Great to see you. It's good to see you too. You are correct. Seller impersonation, it really has developed a lot since the last time we talked in a recent article by certified. It had a recent survey and it was 73% of real estate professionals reported seeing an increase seller impersonation fraud attempts. 58% experience seller impersonation fraud personally or through the company over the last six months. So that's really a big uptick and it shows that the upward. There's an upward trend and it's really expected that seller impersonation fraud attempts are going to continue to increase in 2025.
[00:02:37] Speaker A: Those numbers are staggering. I mean, I still go back to our first conversation and the phrase seller impersonation. If you recall, I think I said something like it made my head want to explode.
[00:02:48] Speaker B: Yeah, I mean, it is.
[00:02:49] Speaker A: Yeah. It's something we've got to all be mindful of and do what we can to protect ourselves and our customers from falling victim to these things.
So let's start with some of the early warning signs of seller impersonation that maybe a property owner or a real estate professional should be aware of something that our title professionals could even share with them.
[00:03:14] Speaker B: Right. Some of really the common warning signs are the type of property, the sign that a transaction could involve seller impersonation is when, if you're listing for a vacant lot or unoccupied land or a vacation home, sometimes even a short term rental, you know the seller. Those type of transactions are ones that could lead towards seller impersonation. But also if the seller is new to the realtor, where they're really an unknown, they came from a lead online.
Another red flag is that the seller, they only want to communicate via email or text. They never want to do video or in person.
And then usually they want to list the property below market value.
And also from some sellers they forgot from that lower market value, they accept an offer really quickly and they want a quick close. And when they do and they want to have a quick close, they're going to want to use a mobile notary because of course they're going to be either they live out of town or they're going out of town. So those are just some of the early warning signs.
[00:04:22] Speaker A: Wow. Well, wow.
Those are all things that I think on a daily basis we're hearing more and more about. But to have you kind of summarize, it makes it real.
So how about some best practices that you think sellers or sellers or anybody that's involved in this transaction can probably adopt in order to prevent themselves or to be aware of something like this that perhaps might be occurring?
[00:04:54] Speaker B: Yeah, I mean really one of the best practices is to act early. So when you have a property type, if it meets those common types for seller impersonation, ask the realtor if they know the seller, do they know the buyer? Have they met them in person?
Ask the seller for id. Ask that early in the transaction. Because there's a lot of identity verification technology out there now and it was developed specifically for this purpose and it verifies that the ID is valid. There's a lot of ways to verify.
One of them is the, like I said, some of the technology out there, but there's also ID checking guides and I think they're available for all 50 states and it uses it to verify any ID that might be presented to you. So that's, those are some of the ways. But then also the title company or the realtor can thank the person for the business. They can send a letter to the seller at the address that shows in the tax records. That's really where all the tax bills go. So a thank you letter could go to that address. And that would alert a true seller that the property is being sold. So those are some of the things you can do, some of the best practices, but the biggest thing about it is to act early and to ask the questions.
[00:06:16] Speaker A: Exactly.
Are there any measures that a property owner can take to protect their property from being targeted by fraudsters?
[00:06:28] Speaker B: Yeah, the best way is to sign up for alerts.
The county recorder's office, a lot of times they have alerts that you can set up on a property and most often these are complimentary. And so it's going to inform the property owner of anything that happens, any document that might be filed against the property pertaining to that property. Property monitoring monitoring services are also out there. But I think I would check with the county recorder's office first because their alerts are often free of charge and they're kind of like the front line.
But things have changed too, because we have vacant land and there is a lot of building happening around us. And the county didn't have the free service a few years ago, but I looked again last year and they now have it available. So I think a lot of the counties are seeing that these alerts are critical to keep fraud at bay here.
[00:07:27] Speaker A: Yeah. So I guess the best advice would be to anyone to check with the recorder and find out if there is something like that available or put the bug in their ear maybe.
[00:07:39] Speaker B: Yeah, yeah, exactly.
[00:07:41] Speaker A: Yeah, yeah. Well, those are some great suggestions.
So what steps do you think a victim of seller impersonation fraud should take the minute they realize that something has occurred and how do they go about remedying it?
[00:08:02] Speaker B: Well, like you said, early on, it's expensive, so I would trust your instincts. If the seller seems suspicious, ask more questions. Ask questions of everyone. And as a title company, you can slow down the transaction. You can say, okay, we need to manage the transaction. It's really important to us and I need to feel comfortable with the transaction. And it's also important that the title agent handles the notarization piece.
So if the seller can't come to closing, then require a notarization to be done by a vetted and approved remote online notary.
So with a remote online notary, you have knowledge based authentication that's used to verify the identity of the seller. And only really the true seller is going to know the answers to those questions. But in some cases, Ron's aren't allowed in states.
So if that's the case, then make sure that the title company selects the notary. You know, don't let the seller dictate that don't let the seller tell you bully you into using their notary, because that's another part of that suspected seller impersonation.
[00:09:15] Speaker A: Yeah, yeah. My, my uncle's a notary. He can take care of this for me. Yeah, yeah. That's a red flag, I would imagine, for sure. Yeah.
Let's talk a little bit about you, the role of law enforcement in other legal professionals. What, what can you tell us about that? And how would a. How would somebody that thinks or suspects that there may be some fraud that's occurred or they think it may occur?
Where do they go?
[00:09:48] Speaker B: Well, the critical part of all that is don't delay in reporting. If you think you've been a victim, make sure that you report. The longer it takes for you to discover it and to report it, the more complicated it gets to correct the problem.
So reach out to the title company who handle the transaction. But also, it's important to report the fraud and file reports with different local and federal state law enforcement. One of them is filing a
[email protected] local law enforcement, state law enforcement, including the state Bureau of Investigation and the state attorney general. And then you can also file something with the Secretary of State for notary violations that may have occurred.
It sounds overwhelming. It seems overwhelming, but just be sure to follow through with that reporting piece.
[00:10:42] Speaker A: Yeah. I would imagine if you called your local police department or your local or your attorney General's office, they could probably point somebody in the right direction because. Yeah, you know, I mean, it's certainly something that overwhelms people very quickly and stress and emotion takes over. So getting, getting to the right people who can help you immediately is critical, I would think.
[00:11:06] Speaker B: Yes.
[00:11:07] Speaker A: Yes. Is there anything new that you've been seeing or that you've heard about in seller impersonation Fry that we haven't covered?
[00:11:17] Speaker B: Good question. Because the United States Secret Service cybercrime investigations, they recently updated an advisory that came out. The first one came out spring of 2022, I believe, and it includes impersonations of the title company.
And so in seller impersonation scams, they're using the real estate listing agent. So they're using a real agent. But when it comes to the contract and when that's prepared, they tell the realtor that they want to use their quote, provide preferred title company for closing. So that preferred title company, they're now part of this fraud. They're not a real title company. They've been impersonated. The scammers set up a website, they set up all sorts of things. So really, the buyers and the realtors need to do independent searches of the title company, use a known phone number, verify the email addresses.
You can go online to any title company and it says about us and it says who their team members are. And you can look at those phone numbers, you can look at the email addresses to verify that you've got a valid. But also, if possible, visit a physical branch of the title company to confirm the validity of that title company.
So I think lastly, you know, they should contact the bank on wiring instructions to confirm the name on that account. So those are just some of the things that are part of this advisory that came out from the Secret Service. Cyber. Cybercrimes.
[00:12:53] Speaker A: Wow. As I said, when we started, you know, when we first started talking about this, it made my head want to explode. And now what I'm hearing you say is title company impersonation fraud. Whoa. Yeah.
Oh, my goodness. Yeah. Well, those are some good tips, I think, because oftentimes you just make an assumption that, oh, this is who the title company is that I'm using or I'm going to be working with or, or the other party in the transaction is. And. But now you really need to do your homework and your due diligence on both sides of this and be sure that they are a legitimate company. Yeah, that makes sense. Yeah.
[00:13:29] Speaker B: I mean, their name's on the contract, you know, but if the seller doesn't own the property, the contracts, you know, it's not a valid contract anyway. But, you know, when you see a title company and that's the preferred title company, you think, oh, of course it's real. Nobody would put a fake one on there. But yeah.
[00:13:48] Speaker A: Yeah. Wow.
Well, those are some great tips. You know, we like to get a bottom line. So do you have a bottom line on this topic that you'd like to leave our audience with before we sign off? Yeah.
[00:14:02] Speaker B: I hate to summarize in such an easy way, but it, you know, it's really, it's a crazy world out there. You know, fraudsters are getting more and more creative with how they're performing their scams. What we talked about last time and what we talked about this time is full circle. It's much more, like I said, creative.
But it's important to be alert. You know, watch for the early signs, the early warning signs, what type of property it is. Ask questions and ask them early and communicate with the key players. And then last thing would be to report any suspected fraud to the appropriate law enforcement and to do it quickly. So that's the bottom line for me on this.
[00:14:42] Speaker A: Well, that's. Well. And I would say, probably, if your gut tells you there's something that isn't quite right. Trust your gut. Yeah.
[00:14:49] Speaker B: Yeah, exactly.
[00:14:51] Speaker A: Yeah. Well, Brenda, thank you so much for spending some time with me today. Don't stay away so long. I won't. Great. Good. Good. And to our audience, as always, thank you so much for taking the time to join us. Till next time, let's all keep learning, growing and prospering. Thanks again.
