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Fraud: Protecting Yourself & Your Clients

Seller Fraud In Real Estate

Often, buying a property is one of the most significant purchases in a person’s life, which makes it an ideal opportunity for scammers. Over the last decade, scams have become more sophisticated, and it is now more important than ever to protect yourself and your clients from fraud.

When a con artist finds a property (likely vacant land), fraud often happens in real estate. They will then contact a real estate agent claiming to be the property owner and state that they want to sell. They will declare they have their own notary or will find one for all the paperwork. Usually, the scammer will tell the agent they want a cash deal or a fast sale, and they will NOT be signing in person but would instead send it through the mail.

At this point, the scammer has already created a fake ID, driver’s license, or passport of the actual property owner to send to the agent. The listing agent now has an offer, which turns into a signed contract and is sent to the title company. The title company opens the contract, orders the title, and communicates with the “seller” through email or phone. They then prepare closing documents and send them via UPS to the “seller.” Keep in mind the “seller” has provided the correct name, address, phone number, email, and government-issued ID, proving they are the person they say they are. How would the title company know any different? The documents are signed and notarized by a certified notary, the deal is then closed, and proceeds are disbursed to the “seller” via check or wire.

In situations like these, it is possible, primarily through legal support, to reacquire the property when another uses fraud to steal and sell. The real estate agent’s reputation and the commission earned will be already compromised.


Conversation from โ€œsellerโ€ to an Agent.

This person then provided a fake ID of someone’s stolen identity and a fake notarized document. With technology constantly improving, people committing fraud are getting bolder in their scams, but technology also helps companies better detect and prevent scams from happening to them.

How is SETCO fighting back and preventing this type of Fraud ?

Until recently, there wasn’t an easy way to 100% confirm the identity of a “seller” on the other end of the email or telephone. Title companies would ask for two forms of government-issued identification. However, the fraudsters would make any form of ID needed to get through that step in the selling process. These con artists can easily find all this information online with a few keystrokes.

SETCO went to work to attempt to find the best Identity Verification Software on the market, and we did! The software we found uses AI technology to detect fake and tampered IDs. It also uses facial recognition and biometric data from the barcode on the ID and compares it with data the state has stored. International identification isn’t an issue with this verification software; it covers over 10,000 ID types in over 190 countries and 45 languages.

SETCO’S mission is to be the leading title and escrow company through advanced technology and excellent communication while ensuring confidence and peace of mind to our extended family of clients.

Learn more about how you can be prepared to combat fraud. Say vigilant, protect yourself and your clients! Setco is offering training to help you spot scams and what you can do to avoid them.

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