Seller impersonation fraud files often look like easy transactions from the start. The property is vacant and unencumbered, and the seller is paying cash. Fraudsters often target non-owner-occupied property, which means the real owner may not discover the fraud for months or even years. Common targets include vacant land, rental properties, second homes, out-of-state owners, inherited properties, and other non-owner-occupied real estate.
This is not a niche issue limited to a few markets. Seller impersonation thefts and attempts are occurring in all areas and in all states, and Security Title has itself been involved in several claims involving seller impersonation fraud.
For title agents, the lesson is simple: these files need disciplined verification.
What seller impersonation fraud looks like
At its core, seller impersonation fraud is straightforward.
An imposter seller pretends to be someone they are not, lists or sells property they do not own, executes documents remotely and without proper verification, takes the sale proceeds, and disappears. The rightful owner, the would-be buyer, and the title company are left dealing with the fallout.
Why these properties are prime targets
Fraudsters do not pick properties at random. Seller impersonation fraud typically, though not always, involves vacant or absentee-owner property. That can include vacant land, empty residences, second homes, rental property, or property tied to a deceased owner.
The common thread is simple: the real owner is not likely to be physically present when the property is marketed or shown.
These properties also generally involve actual owners who often live out-of-state, and a remote closing would be typical.
Identifying red flags
- Download the Red Flags & Verifications Checklist
Communication red flags
The fraudster seller often exhibits red flags that should raise suspicion in a title agent. Often times the seller:
- Only has a digital presence
- Communicates only by text or email
- Refuses to follow routine procedures
- Refuses to take a voice or video call
- Has stories like family emergencies or being out of the country with limited phone access
- Insists on a quick closing
- Insists on using their own notary
- Insists on a cash buyer
- Will only accept sale proceeds in a wire
Property red flags
Some properties and file attributes deserve heightened attention from the start.
- Vacant property
- Rental property
- Vacation property/ second home
- Property with back taxes or other signs of neglect.
- Unencumbered property
- Below-market pricing
- Quick closing
- Seller’s mailing address does not match the owner’s mailing address in the tax records.
Document and notary red flags
Documents deserve scrutiny too, especially when the title agent is not personally verifying the seller’s identity.
- Use of unknown notaries
- Seller-selected notary
- Notary in different state than the seller
- Signature of seller does not match other signatures in the chain of title or other public documents
Seller Proceeds red flags
The way in which the seller insists on receiving the proceeds can also raise red flags.
- Will only accept a wire
- The wiring instructions are to a bank that is not located near the seller
- Wants the funds to be disbursed to another individual’s name than the actual owner
- Wants a wire to an overseas account
Verification prevents seller impersonation fraud
The most effective defense against seller impersonation fraud is independent identity verification.
Verify the seller independently
It is critical to use a commercially available ID verification service as the first line of defense against seller impersonation fraud.
Use Intellicheck to verify the Identification of the seller. This should be done in all instances where there are several of the red flags noted above and can be performed at the opening of the file in the title software.
All Security Title agents have access to our free ID verification tool from Intellicheck. Click here for more details.
Contact the seller (either through a phone call to an independently obtained phone number or by sending a confirmation letter to the owner at the tax-record mailing address) and ask them to confirm transaction details only the legitimate seller would know.
Verify where the money is going
If there remain sufficient identity concerns by the time the closing occurs, the final verification you can do is ensure that the money is going to the actual seller.
After all, for fraudsters, it’s all about getting the money.
- Use a Bank Account Ownership (BAO) verification tool such as Plaid or CertifID to ensure the name on the bank account where the proceeds are being wired to is the name of the actual property owner. Rynoh also has this feature built into their platform for its users
- Proceeds should not be wired to a location outside of the country
When the red flags are numerous and facts don’t align
When the facts do not line up, pause the file. Document the red flags and verify the seller’s identification independently. Escalate the file to management when needed.
Management should contact Security Title’s legal department if the agent suspects they will become or have become a victim of Seller Impersonation.
Catch the pattern before it becomes a claim
Vacant land. Remote sellers. Rental properties. Inherited property. Rushed closings. Cash deals. Unknown notaries. Email-only communication. None of these factors alone proves fraud, but they are common characteristics of higher-risk transactions. When these red flags are present, title agents should shift from routine processing to heightened scrutiny and independent verification.
Security Title’s experience and fraud prevention guidance makes one thing clear: the strongest defense against Seller Impersonation fraud is identity verification before closing.
Catch the right red flags early, and a suspicious transaction does not turn into a title claim.
Miss them, and it can become a claim.