Protecting Your Clients from Real Estate Fraud: What Every Agent Needs to Know

Here’s what you need to know to protect your clients and your business.

Wire Fraud: Still the #1 Threat at the Closing Table

Wire fraud remains the most common—and financially devastating—scam in real estate. It typically begins with a hacked email or spoofed domain. Fraudsters monitor the transaction closely and strike when the buyer is most vulnerable, usually right before closing.

They send fake wire instructions that appear legitimate, often using the name and email signature of the real estate agent or title representative. Once the buyer wires the funds, the money is nearly impossible to recover.

Tips to Stay Ahead:

• Remind your clients to always verify wiring instructions by calling the title company directly using a well-known, trusted phone number.
• Use secure email systems or encrypted transaction platforms whenever possible.
• Let your clients know upfront: wiring instructions will never change via email. If they receive an unexpected message with updated instructions, they should stop and call immediately.

 

Seller Impersonation Fraud: A Rapidly Growing Threat

This scam is gaining momentum—and fast—particularly in areas with vacant land and absentee ownership.

Here’s how it works: scammers search public records to identify properties that are owned free and clear, often targeting vacant lots or second homes. They pose as the legitimate owner, providing forged documents, fake IDs, and even spoofed notary credentials to initiate a fraudulent sale. Sometimes they even create fake email addresses that closely resemble the owner’s or the listing agent’s.

Because these scammers push for remote closings and quick timelines, they can sometimes fly under the radar—until the transaction is complete and the funds are gone.

Why It’s So Dangerous:

• These scams are sophisticated. Fraudsters often know the property history and replicate communication patterns to appear credible.
• Even experienced professionals—agents, attorneys, and title companies—have been tricked.
• Once the closing occurs, reversing the damage is difficult, time-consuming, and costly.

Red Flags to Watch For:

• The property is vacant or owned free and clear.
• The seller insists on a fast, remote closing.
• All communication happens over email or text—never a phone or video call.
• IDs or documents seem “off”—blurry scans, mismatched signatures, unusual notary stamps.
• Contact information doesn’t align with public records or past correspondence.

What You Can Do:

• Cross-check seller info with appraisal district records and prior closing documents.
• Verify identity using multiple authentication methods.
• Be especially cautious with out-of-state sellers, inherited property, and vacant land.
• Trust your gut—if something doesn’t feel right, escalate it immediately.

 

Fraud Prevention is a Team Effort

Protecting your clients from fraud isn’t just the job of the title company—it’s a joint effort. It starts with education, continues with proactive communication, and succeeds through collaboration.

Be the professional your clients can trust in every situation. And remember, when in doubt, pick up the phone and verify.

 

Stay smart. Stay secure. And keep fighting the good fight.