Real estate scams target sales and rentals

LARAMIE — Stephanie Fortman had a gut feeling about a sale of some land near Laramie. Something wasn’t right.

The seller told her he was building a house and wanted to sell the property quickly, below market value, to finance his new home.

“Quickly,” Fortman, an associate broker at Mountain Valley Properties said. “That’s a word I learned — quickly.”

The reason for the speed, she eventually discovered, is that the seller was trying to profit from selling a piece of property he didn’t own.

In the absence of concrete evidence, Fortman moved ahead with the sale. But she couldn’t help but feel that something was “off.”

“I went ahead and listed the property,” Fortman said. “Fortunately another agent in town had worked with the owner personally. She called to ask ‘Why did you list so-and-so’s property?’”

That’s when Fortman got the call telling her that the actual owner had not listed the land for sale.

“Fortunately, nothing had transferred in my scenario. But it was eye-opening,” Fortman said. The selling-someone-else’s-property scam is one of several realty frauds brought to light by members of the Laramie Board of Realtors. Recently, the board’s president and past president joined Fortman to alert the public to potential realty scams.

“There are all kinds of scams,” said Effie Bader, associate broker at Laramie Land Company and president of the realtors board. “We’ve had wire fraud, seller listing fraud; we’ve had buyer fraud — of them doing false earnest money checks — and we’ve had rentals posted that are not true rentals.”

Earnest money is a portion of the sale price that the buyer deposits to show they are serious about the purchase.

The number of fraudulent transactions is small, Bader said. Out of the 366 sales this year, only three or four were reported to the realty board. But that number is probably low, and false rental scams may be much more common than are reported.

Even if the number of scams is low, the impact on an individual can mean a loss of thousands of dollars.

The scams can be a problem for buyers and sellers who sell property directly, as well as those who work with a real estate agency.

Rental fraud 

Amber Cross, a broker with Century 21 Associated Brokers, recently handled a rental fraud.

“You know the saying, if it looks too good to be true, it probably is?” she asked.

Recently, her realty office was asked to show a property to a potential buyer.

When she arrived, she noticed that the buyer asked some unusual questions. They weren’t concerned about features of the house that would usually interest a buyer.

They did ask about the monthly rent and the security deposit.

She told the potential “buyer” that the property was for sale, not rent.

“So the fraudster had scraped the information from a Realtor.com or Zillow of that nature, and put it on Craigslist as being for rent. This was a $330,000 property being offered for rent for $1,300 a month,” she said. Too good to be true.

The scammer copied the picture and the Century 21 Brokers logo from one of the online sales sites and posted it on Craigslist with the scammer’s name and phone number as the landlord. With rentals hard to find, renters may be willing to commit to a property sight unseen. They’ll sometimes send the first and last month’s rent, plus a security deposit, potentially thousands of dollars.

By the time Cross found out about it, she estimated the listing had been on Craigslist for a week. Although she was able to stop this false rental, there is no way to know how many potential “renters” sent their deposits to a fake landlord.

With the University of Wyoming in town, the rental market is tight and many students don’t have the option of seeing properties in person. That makes it more important to make additional phone calls before sending, Bader said.

She recommended calling a Laramie real estate office to ask if the property is actually a rental. They can’t investigate fraud but they can help the renter ask the right questions before sending money.

Wire fraud

The internet has made it possible for more sophisticated scammers to pull money from potential sales.

One of Bader’s transactions was interrupted when earnest money was set to be wired to a bank account owned by a scammer.

The scammer hacked the buyer’s email account and pretended to represent the seller.

They often use the internet to search for words in subject lines such as “wire” to see who might be making a transaction, Bader explained. That tells scammers which email accounts to watch and hack.

The scammers changed one letter in Bader’s email communications. It was an easy change to overlook.

Fortunately, Bader had warned the buyer that wire transfers or instructions for wires should never be sent in an email.

The hackers pretended to be Bader and claimed that they would be sending the final documents to the seller. He noticed the incorrect spelling in Bader’s email and a statement on his title commitment that said, “Because of wire fraud, we have our own wire account.”

Those details saved the buyer from wiring $300,000 to the fraudulent account. It is unlikely that he would have been able to retrieve the money as the hacker was likely not in the U.S.

“I’ve never had it happen so bad as this. They’re persistent. That’s another thing to watch out for. Persistent. I mean he would get five emails a day asking for that money,” Bader said.

Her recommendation is to ask if the title company has a wire portal, but also to call the title company to make sure they are accurately represented.

Buyers’ and sellers’ fraud

Earnest money checks can create trouble for both buyers and sellers.

Though some banks process checks quickly, others may take several days before the money from the check is deposited in an account.

“It’s important for the public, or by-owner [sellers] to make sure their checks clear,” Bader said.

Buyers need to ask how earnest money will be handled.

“If they are not holding the money, as we do as a real estate agency, in a trust account, or at the title company, and you just hand over $10,000 in earnest money, they can ghost you like that,” Bader said.

Sellers can be scammed when a fake buyer sends a check for earnest money, then quickly finds a reason to back out of the transaction. They may ask for their earnest money back after paying it with a fake cashier’s check.

That means the “refund” will be sent to someone who never sent the earnest money.

“This is something the real estate businesses know, but not necessarily the general public,” Bader said.

Prevention and legal action

While it may be impossible to identify all scammers, there are ways to reduce the risk of being scammed.

Bader recommended slowing the transaction and asking questions about the sale. Keep email and phone records, Bader added.

Again, the word “quickly” may be a red flag. Scammers don’t want victims to take the time to check all the details.

It’s also important to look at the level of pressure in the requests for money. Title companies don’t pressure buyers, Cross said.

Pay attention to the professionalism in the language in emails. Scammers make demands, sometimes with inappropriate slang, hoping they can trigger someone into sending money because they don’t want to lose the property.

If a buyer or seller suspects they’ve been scammed, they can report it to law enforcement.

Internet crimes can be reported to the Internet Crime Complaint Center at https:// http://www.ic3.gov or the FBI at https://www.fbi.gov.

Locally, if money changes hands, it is considered a fraud case, said Aaron Appelhans, Albany County Sheriff said in a phone interview with the Boomerang. Although real estate scammers are not new, they have been much more common as use of the internet spread.

Appelhans echoed Bader’s recommendations.

“Verify. Call the realtor, title company. Verify the property, that the property you want to buy is real and on the market,” Appelhans said.