Federal law enforcement sees ‘sharp increase’ in vacant property scams
Secret Service: Scheme has particularly affected elderly and foreign real property owners
InvestigateTV - Federal law enforcement has seen a sharp increase in reports of real estate fraud involving vacant property, according to a joint advisory issued by the U.S. Secret Service and CertifID.
Industry experts said that increase could be caused by new tactics used by con artists to target prospective buyers.
CertifID Chairman Thomas Cronkright explained the scheme: a fraudster will look up ownership records of a vacant property online, then pose as that property’s owner and hire a real estate agent to list it for sale.
The scammer will then push for a cash sale under market value in the hopes of closing quickly and stealing all of the buyer’s money.
“I hate to say this but it’s relatively simple to do, and that’s what concerns all of us,” Cronkright said. “We’ve had some people that’ve faced homelessness after this, because they’ve already sold their house.”
He said this scam is happening all across the nation, particularly with commercially zoned properties where vacant land might be worth more than a residential lot. He added vacant land is an easier target for scammers because the property’s owner may not pay as close attention to it until they’re ready to build on it.
Investors Title Insurance Company Vice President of Risk Management Jonathan Biggs said some victims have lost hundreds of thousands or even millions of dollars.
Cronkright and Biggs said there are several ways you can protect yourself:
- Ask your real estate agent a lot of questions about the seller
- Ensure that your agent or the listing agent has met the seller in person and verified their identity
- Be wary of properties listed at below market values for cash only sales
- Never allow a seller to arrange their own notary closing
- Make sure you use a trusted title company or closing attorney to coordinate the exchange of closing documents and funds
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