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NW Fla.: Fake Sellers Fool Some RE Agents

By Kymberly Franklin posted 16 days ago

  
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NW Fla.: Fake Sellers Fool Some RE Agents

A referral “seller” uses fake IDs to prove they own a property and then ask an agent to list it for sale. The usual targets: Out-of-state owners without a mortgage.

CRESTVIEW, Fla. – Financial advisors rave about paying off debt, but sometimes being debt-free is being vulnerable. As more real estate transactions are being completed by email or overnight mail, without sellers meeting buyers in person, it’s become easier for criminals to target vacant lots owned by absentee or non-local owners.

Recently, a vacant Navarre Beach lot was sold without the knowledge of the owner. The lot didn’t have a mortgage and the owner lived out of state.

An imposter seller went through a referral company and reached a Realtor in Fort Walton Beach. The imposter seller claimed there were family issues and the lot needed to be sold in two weeks with a cash deal. The Realtor received copies of driver’s licenses and social security cards from the imposter sellers that looked credible.

The eventual buyer of this property saw the land become available and jumped on the deal and took money out of retirement funds to “make it happen.” Within two weeks, the land was closed on, the commission check went to the Realtor and the Realtor showed up at closing with a bottle of wine saying, “This is the easiest deal I’ve ever closed on – except for the seller’s thick accent,” according to the buyer.

The buyer put in a variance request with the county and had no idea that the sale was not legitimate. However, everything started to unravel almost two weeks later when they received a phone call from the real owner who had been notified by Scott Parsons of Navarre’s Reliable Land Title, that the property had been sold.

Luckily, due to a hiccup with the wire transfer to the fraudulent seller, red flags appeared, and Parsons started trying to find the seller by phone numbers other than what the real estate agent provided. Parsons was able to recover all funds for the buyer, who was also a Navarre Beach property owner. Parsons even reimbursed the buyer for ancillary fees that were not recoverable.

While similar, the actions are not considered identity theft because the imposters did not have access or use the victim’s actual account and identification numbers. This attempted crime would not have been stopped in its tracks by services such as “Home Title Lock.” The title lock service would only catch this crime after the fact. According to the Santa Rosa County Sheriff’s Office, if the transaction had gone through, it would be a matter for state and federal government. “The goal is always recovery,” a department spokesman said.

This type of fraud can be prevented if all parties involved in the transaction remain skeptical. A similar fraud was attempted a few weeks ago on Pensacola Beach. According to the Realtor involved, they received a future client through a referral agency, similar to the Navarre Beach case, though the specific referral agency has not been revealed. When the Realtor contacted the fraudulent seller from the referral, he was very well spoken but was eager to get started. “Let’s do this,” he said..

The Realtor was immediately skeptical because the fraudulent seller never asked what the market was like, or the commission that would be charged.

The Realtor searched the area where the real property owner was living and found three different families with the same last name. She contacted them and left messages to make sure they were one and the same as the person that had contacted her. In the meantime, the Realtor contacted the fraudulent seller and asked him to send his driver’s license, adding “There is a lot of fraud going on.” He didn’t flinch and immediately sent his driver’s license. The Realtor didn’t hear back from any of the messages she had left earlier, so the Realtor listed the property.

Within 24 hours, the Realtor received a call from a family member.

“I was told that I had no right to list their property.” The Realtor told the family member that she had been sent what was supposed to be her husband’s driver’s license. “She asked me to describe her husband and verify the eye color,” said the Realtor. In the end, the Realtor convinced what turned out to be the true owner’s wife to send a copy of her husband’s driver’s license. The Realtor took both licenses to a Sheriff’s Department annex where they verified that one was an imposter, and the real owner was the driver’s license that the wife sent the Realtor.

“And that was the end of it,” said the Realtor. “The Sheriff’s department said I could be talking to someone in Russia. They didn’t want to pursue it further. I just quit answering texts and emails and took the property off the Multiple Listing System (MLS). “

The Pensacola Beach case was caught early by an astute Realtor. In the Navarre Beach case, the Realtor seemed to be blindsided by a quick and easy sale for a premium lot below market value and missed all the warning signs. The buyer of the Navarre Beach property was very disappointed that it was, in the end, not a legitimate sale, but feels fortunate to receive their money back.

“At one point, fingers started pointing at us as if we should have known better because the lot was undervalued. You can’t blame us for jumping on a deal. I thought I was dealing with a licensed professional who should have done their homework. I knew more about the property than the Realtor did,” said the buyer.

In both instances, the Okaloosa, Santa Rosa, and Escambia Sheriff’s departments did not want to pursue the leads because, “funds had been recovered or never exchanged hands.” However, since Navarre Press’s inquiries, the Santa Rosa Sheriff’s Department has referred the evidence collected by Navarre’s Reliable Land Title’s owner, Scott Parsons, to the Major Crimes Division.

Moving forward, Parsons is investing in a paid service that will verify the seller’s identity and make sure the seller is communicating via computer and phone from the United States. The service also asks the seller a series of questions that only they would know, such as addresses they formally resided at, and models of cars they have owned. The service will also check the wire transfer information and make sure the money is going to the correct person.

“We are all in this together. Everyone needs to keep their eyes open. Everyone had an opportunity to catch the Navarre Beach deal before it got to the point of a wire transfer – us included,” said Parsons.

In Parsons’s after-action report, he stated several observations and warning flags that surfaced:

  • All contact via email and phone
  • Vacant lot with absentee owner
  • Used a family emergency for the reason that the deal had to close fast and with cash
  • Changed wire instructions
  • Emailed wire instructions
  • Lack or difficult contact with wife even though DLs show they live under the same roof.
  • FedEx package dropped nearly 4 hours away from where real owners lived but had a Santa Rosa County Notary. (Notary ended up being faked.)
  • Listing based on a referral – which seems to be common with fraud. (Referral services include Zillow, Realtor.com, RedFin, and more.)
  • Sold significantly under market value
  • Title was free and clear. That means no loan payoff so no real SSN or loan number required.

What can property owners do to make sure this doesn’t happen to them?

  • Keep some kind of loan or encumbrance on your property.
  • Place a lien on your own property.
  • File a letter with the Clerk of Court that says verified contact must be made with the owner prior to any sale of the property.

What can Realtors do?

  • Heed the warning signs
  • Conduct public records searches on sellers that you are listing property for especially if they are remote and the property they are selling is unencumbered.
  • Do your best to reach the sellers independently other than the number that was given to you from a referral service.
  • Conduct research on Driver’s License numbers through Department of Transportation https://mydmvportal.flhsmv.gov/home/en/publicweb/dlcheck/

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