Land Ownership Scam in Real Estate

Recently, one of our agents responded to a request from a land “owner.”  This person wanted to list his parcel of land with us at Central Coast Realty.  He told us information that all matched the parcel’s records, including the fact that he resides out of the United States.  

Our agent, familiar with the procedure for listing requirements, asked him for two forms of Identification. When he didn’t respond, she looked up the address on her local MLS. That same parcel had been listed for a single day, about a month ago, and withdrawn. The listing brokerage told her that the person claiming to own the land was not the actual owner of the parcel.

FIRPTA (the US Foreign Investment in Real Property Tax Act) is familiar with similar attempted scams.  There is a helpful video describing what the scammers do to try to fool a listing agent.

What can you do to prevent yourself from getting fooled?  If you are a buyer, be sure the listing agent has done the homework before offering a property for sale. If you’re an agent and a potential listing involves an owner who lives out of the country, here are a few things you can do to avoid being involved in this kind of scam.

  • Ask for two forms of identification
  • Ask to have a video call
  • Contact the owner of record from the previous purchase (a short card or letter)
  • When you use software to send documents for signatures, look up the IP address of the person who signed. The IP address should match the owner of record’s location.
  • Be wary if the “owner” says they don’t want to work with FIRPTA or don’t care about the IRS refund.

Central Coast Realty is currently researching two more “leads” involving Florida land owners residing outside the US. Stay tuned for how these more recent possible listings shake out!

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