My home state of California has over 400,000 licensed real estate agents. On July 13 the California Department of Real Estate (DRE) sent out an advisory to all licensees. The warning was about fraudsters posing as owners of vacant land and contacting real estate agents, asking them to sell a property they do not own. Briefly, this is the modus operandi of the bad guys:
- They search property records for properties that are free of mortgages and any liens. They focus on vacant lots and long term/vacation rentals preferably owned by the elderly or foreigners.
- They pose as the owner and contact an agent to request a listing.
- They ask the property be listed below market, no For Sale sign be posted, and seek a cash buyer for a quick close.
- They refuse to meet in person and refuse video calls.
- They refuse to attend the closing, pretending to be out of state or the country.
- They demand to use their own notary who provides false identification.
- They insist proceeds be wired to them
The DRE suggests realtors request in person/virtual meetings and see proper government identification. Conduct an online search using the property owner name, find a phone number, and contact that person to verify they are the owner. Send to that owner the electronically signed listing agreement. This may alert the owner to a potential fraud. Lastly, utilize a wire verification service.
We live in an uncertain world. Feel free to share this information with any real estate agents you know.