Bad Guys Don’t Wear Black Hats

Protecting consumers’ personal information, financial data and real property are top priorities and require more education and vigilance than at any time in the past. Fraud and identity theft are commonplace problems in today’s world. Technology is a tool like any other, which works both for legitimate businesses and for those who prey on unsuspecting consumers. Many of the basic defensive principals of the past still apply, but there are no unbeatable or fool-proof systems to avoid becoming a fraud victim. Fortunately, consumers have many tools available to keep one step ahead of the bad guys. 

An escrow holder is a neutral third party whose purpose is to hold documents and funds pertaining to a specific property transaction until all conditions written in the instructions of the principals are satisfied. In the world of real estate, businesses, equipment and just about any other thing that can be bought or sold, the neighborhood Escrow Company can be the consumer’s biggest asset to protect against fraud. Escrow has played an important role protecting consumers as they sell and purchase property. The escrow process has become even more vital today with the advent of internet-based transactions with parties oftentimes living halfway around the world. 

Detecting Real Property Fraud

The experienced and well-trained escrow officers and companies develop a “sixth sense” for situations that just don’t feel right and can often identify problems before they occur. 

Many of the time-honored tools of the escrow officer – such as personal appearances by sellers and buyers at the escrow office – are becoming more difficult to employ as people opt to work exclusively through their agents and use mobile notary signing services. Of course, convenience comes with a price tag. According to law enforcement, personal appearances with an escrow officer would prevent a large amount of the real estate fraud perpetrated today.

 Schemes in real property fraud range from: (1) criminals posing as the owner of a piece of property (usually non-owner occupied) and attempting to sell or refinance it to pull out equity (leaving the real owner to pay the bill); (2) criminals posing as the owner of a piece of property and attempting to sell it to a legitimate buyer and run off with the money leaving the real owner and buyer to sort out the ensuing legal mess; (3) criminals using “straw” buyers who are basically renting out their identity and credit to someone else who may be using the property as part of a larger scheme. Identity theft and forgery are often a large part of these fraudulent schemes.