The Ohio Department of Commerce’s Division of Real Estate and Professional Licensing has issued an advisory to make Ohio consumers and real estate agents aware of an increased threat involving fraudulent real estate listings.
According to the FBI’s Internet Crime Complaint Center, in 2023, it received 9,521 real estate-based complaints that amounted to $145,243,348 in losses, exceeding losses related to identity theft-based crimes ($126,203,809).
Recent reports from across the country have revealed a concerning trend where individuals are contacting agents to sell properties they don’t own. For example, a person posing as the owner of a vacant lot or home may ask an agent to list the property and present a false ID to prove their ownership. If not caught and a transaction is completed, the scammer takes the money and disappears, while the buyer is left with a property they believe they’ve purchased, but isn’t lawfully theirs. This malicious practice puts licensees and consumers at risk of unwittingly engaging in fraudulent transactions.
“We learned of a situation from an agent who was contacted by someone who claimed to have several properties with multiple owners who all wanted to sell,” said REPL Superintendent Daphne Hawk. “The agent requested identification of all sellers involved but received only two and she was not confident in their validity. The agent thought it was a red flag that the individual requested to get the properties listed quickly, so she spoke with her broker, and they confirmed the provided driver’s license was not valid. At that point they filed a police report. This is a great example on how to handle such situations and we encourage our licensees to take similar measures.”
In response to this escalating threat, the Division of Real Estate and Professional Licensing recently issued an alert to licensees on best practices to avoid falling for this scam. The alert lists a number of tips for real estate agents to keep from becoming a victim, including:
- Exercise due diligence: When approached to list a property, do thorough research and verification. Avoid rushing into listing agreements without conducting proper due diligence on the ownership of the property.
- Be vigilant and attentive: Be alert during interactions with clients and always pay attention to details. Request photo identification to validate the identity of individuals involved in transactions. Stay vigilant for signs of fake identification and promptly report any suspicions to your broker or appropriate authorities.
- Multiple owners: In listings involving multiple owners, ensure that all owners provide their signatures on agreements. This includes, but is not limited to, both spouses, siblings, heirs and all members of an LLC to prevent complications.
- Verification: Utilize resources such as the auditor’s site and recorder’s office to confirm ownership details. Verify the authenticity of documents to protect against fraudulent activities.
- Client pressures: Do not succumb to clients who pressure you to list properties quickly at the cost of thorough procedures. Prioritize compliance with regulations and safeguarding the interests of all parties involved.
In addition to fraudulent listings, the Division is calling attention to the issue of property title fraud, also known as deed fraud, which poses a threat to property owners. Deed fraud involves malicious actors forging signatures, falsifying documents, and/or illegally transferring property titles to themselves, leading to unauthorized sales of mortgages. While there have not been any widespread reports of deed fraud in Ohio, the Division is warning Ohioans to be vigilant as it is becoming a bigger issue across the country.
Homeowners who have no mortgage or have paid their mortgage off are especially vulnerable to deed fraud as they no longer have a third-party to catch any changes with the county auditor. To protect themselves, consumers are encouraged to contact their county recorder offices, many of whom have engaged the services of software vendors that can alert consumers if a document has been filed in their name. If someone believes they are the victim of a scam, they are encouraged to contact their local law enforcement authorities.
For information on a wide range of consumer topics related to real estate, visit the Division’s website by clicking here.
The Division of Real Estate & Professional Licensing is a state agency within the Ohio Department of Commerce. To learn more, visit www.com….
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