The Emergence of Seller Impersonation Fraud

Recent reports from various title companies and other leaders in the real estate industry show that across the United States, systematic fraudulent schemes involving sophisticated seller impersonation efforts are targeting existing owners and prospective purchasers of vacant, unencumbered land. These schemes target both residential and commercial properties in rural and metropolitan areas alike.

The scammers orchestrating these schemes typically begin by searching various real property records to identify real estate that is free of any mortgage or other liens (often vacant lots or rental properties) and the identity of the property owner. Next, scammers will contact a real estate broker posing as the owner to list the property for sale (often at a below market value to generate immediate interest). Once a prospective buyer is identified, the closing process will begin. Although scammers typically will communicate only by email through this process, more sophisticated operations recruit individuals to participate in all transactional phases, including diligence phone conversations and even personal appearances at signings. When facilitating due diligence and closing efforts, scammers will forge notary stamps, signatures and even identification documents such as driver’s licenses. These falsified documents are provided to the title company or closing attorney at closing, the fraudulent deed is recorded and the buyer’s funds are wired to the scammer (often to an overseas account).

An Effective Safeguard for Property Owners – Fraud Alerts at the County Level

While this surge of fraudulent activity is alarming, the good news is there is an effective mechanism by which property owners can be alerted to such activity involving their own property, including any attempted fraudulent conveyance. Many counties in North Carolina now possess some form of notification system through which property owners can register at no charge to receive notifications and/or fraud alerts via email if anything is filed in that county’s register of deeds office using the owner’s registered name(s) (registration links for each county’s current notification system are included in the table below).

By way of example, the monitoring system offered by the Wake County Register of Deeds Office requires just two simple steps to register online – (i) entering an email address where you wish to receive notifications, and (ii) selecting individual and/or business names that you would like to be monitored (you may select up to four). Once registration is completed, you will then receive an email if anyone attempts to file a document using any one of the registered names. If you ultimately receive notice of an unauthorized filing, it is important that you act quickly to mitigate the situation.

Registration Links for North Carolina Counties with Property Fraud Alert Systems