Discover the latest real estate scams and get tips on safeguarding your business and clients.
Discover the latest real estate scams and get tips on safeguarding your business and clients.
Tom Cronkright
8 minutes
Cybercrime
May 2, 2023
The real estate industry has come a long way in grasping the telltale signs of real estate scams, working hard to shift the advantage away from cybercriminals looking to defraud buyers and sellers.
These critical investments in new tools, education, and coordination across the industry must continue. It’s also essential to stay ahead of real estate fraudsters’ latest techniques—the scams and tools they use in hopes of a big fraud-related payday.
In this article, we examine the latest developments in real estate scams that the CertifID team is monitoring, and we share tips for safeguarding your business and clients from these threats.
Although the real estate industry has become more adept at identifying and preventing real estate scams, criminals are still working hard to find new ways to trick victims. Here are some of the most creative and dangerous tactics the CertifID team is keeping an eye on.
As digital tools become more accessible, criminals are using them as part of sophisticated scams to deceive victims. One of the most notable techniques is spoofing trusted versions of documents and other communication, such as emails and letterhead.
In these cases, fraudsters take advantage of customers who do not know what a "trusted" document from a legitimate real estate professional, title company, lawyer, or bank looks like. By manipulating documents and impersonating legitimate sources, these scammers can trick individuals into providing sensitive information or making fraudulent payments.
Similarly, real estate fraudsters are also becoming bolder in their attempts. In addition to spoofing trusted documents and communication channels, these criminals are now taking a more direct approach, contacting incoming or potential clients directly to learn more about their transactions and using that information to build call chains with other involved real estate professionals to extract detailed information.
Armed with the right information, these fraudsters can facilitate or manipulate significant portions of the real estate transaction and build trust among several victims. Even more concerning, fraudsters are enlisting other unwitting victims or co-conspirators to show up in person and support the fraudulent exchange with fake identification or documentation.
As coordination moves to digital communication and leads to fewer in-person meetings, fraudsters are tricking victims with technology that facilitates the creation of spoofed phone numbers and convincing fake websites.
By spoofing the phone number of a legitimate company or bank, the fraudster can appear more trustworthy and increase the chances that a victim will provide sensitive information or send payments. These tactics may also be paired with fake websites that closely resemble legitimate sources—often complete with similar branding, design, and language—to trick victims into entering their personal information.
In addition to the exploitation of unsuspecting buyers and sellers through fake websites and phone numbers, cybercriminals have also been using a tactic known as business email compromise (BEC). By hacking into the email account of a real estate agent, title or settlement company, or other professional involved in the transaction, fraudsters can impersonate them in email correspondence with other involved parties and manipulate financial information within the transaction.
To protect your business, clients, and your reputation from real estate scams, it's important to think proactively. Here are some key actions you can take to stay ahead of fraud attempts lurking around the corner.
To stay ahead of evolving real estate scams, proactively educate clients. Some of the most effective techniques include:
Take the sensitive financial information out of less secure forms of communication by leveraging an industry-leading platform like CertifID, which gives your clients and business the ability to:
Because it's difficult to predict what techniques fraudsters will attempt next, it is equally important to ensure that your organization and employees are practicing strong cybersecurity hygiene. These steps include:
The real estate industry has made significant progress in identifying and preventing real estate scams, but cybercriminals are still finding new ways to trick victims. This is especially true as new digital tools become more accessible and ubiquitous, paired with fraudsters who are more sophisticated, creative, and bold in their tactics.
It is more important than ever to take proactive security steps such as educating your clients, securing the wire transfer instruction process, and practicing strong cybersecurity hygiene. By staying ahead of the latest fraud tactics like those shared in this article and taking proactive measures, your business can better safeguard your organization, clients, and reputation from the damaging effects of real estate fraud.
Want to take your protection against wire fraud and other real estate scams to the next level? Get your own copy of CertifID’s e-book, Clear to Close: The Complete Guide to Real Estate Wire Fraud, now!
Co-founder & Executive Chairman
Tom is an accomplished entrepreneur and licensed attorney. He has founded and led award-winning businesses to receive honorable recognition in their respective fields. Tom is also a highly sought-after speaker who lends his expertise to the world of real estate, fraud, and security-related topics across the country.