Resources

Ticor Fraud Insights

Publisher: Fidelity National Financial. Editor: Lisa A.Tyler | National Escrow Administrator

In this issue … The Consumer Financial Protection Bureau (CFPB) has recognized the overwhelming increase in elder abuse statistics. The massive amounts of yearly losses by elders has prompted the CFPB to take actions, such as issuing reports, guidelines…

On July 9, 2019, a mobile signing agent met with an elderly woman who was selling her home in Texas. The escrow officer in Texas made all the arrangements for a mobile signer to meet with the seller because she had moved to Mississippi…

An unscrupulous associate–level real estate broker in Colorado wrote a purchase contract for the sale of his father’s home. The agreed upon sales price was $325,000. The contract, written on June 11, 2019, was an all–cash offer, closing…

In Southern California the majority of real estate transactions are closed by independent escrow companies. The title company insuring the transaction receives lender’s funds to close, pays the existing encumbrances, property taxes and the title…

Title insurance is a valuable product which protects property owners. Here are some of the values…

The articles contained in this edition make us miss the days when the biggest thing the real estate industry was combating was mortgage fraud.

I recently attended a conference where the CEO of a lending company shared a story about one of his peers: The CEO of another lending company was victimized by this crime. In the end, the CEO paid the equivalent of $1.5 million in bitcoin to the hackers, in order to restore his computer systems. Lenders must be a target, because that same week another lender reported they were successfully attacked and were held for ransom. Read “RANSOMWARE” for more details about how the crime affected one city.

Buyers all over the country are the targets of hackers attempting to steal their life savings. They strike innocent, hard-working homebuyers when they are most vulnerable: Engaged in the process of buying a home. The process of buying a home is described by buyers as, “crazy challenging.” There are a lot of “i’s” to be dotted and “t’s” to be crossed, which is why hackers are successful in their attempts. This article will demonstrate steps the Fidelity National Title Group takes to prevent this; but the thieves are still winning. Read “HOW to lose your life savings” for all the details.

Wire transfer fraud is the fastest growing real estate cybercrime in the United States. Attempts by fraudsters to divert wire transfers have not weakened. Instead, the hackers have broadened their horizons. Although homebuyers are the most common target for this fraud, anyone involved in wiring money during the closing process are vulnerable. Recently, the fraudsters have figured out how to infiltrate documents sent via eFax® systems and alter payoff demands.

Stephanie Cannon, Closing Services Manager for Title Underwriters Agency, knows all too well the schemes and scams used to succeed at this type of fraud. She tirelessly reminds her staff to be alert and to look for any discrepancies to avoid falling victim. Her efforts have paid off. Read “CLEVER wire fraud schemes” for more details.

Nationally, title insurance companies belong to the American Land Title Association (ALTA). ALTA works throughout the year on behalf of the industry. For the last several years, the ALTA has put together some terrific resources for home buyers through their Homebuyer Outreach Program (HOP). They have put together informative materials which can be shared with consumers to describe what title insurance is, since many consumers do not truly understand the value of an owner’s title insurance policy. Read more in the article entitled “AMERICAN land title association.”

IN THIS ISSUE:

The Federal Trade Commission (FTC), banks and gift card companies nationwide are warning consumers of a new scam where an imposter contacts a consumer requesting they immediately go buy gift cards. The contact is initiated through either…

Consumers are being called, emailed and texted to purchase gift cards. The contact is initiated by someone posing as an Internal Revenue Service (IRS) Agent, technical support, family member or even as an employee’s boss… READ: Gift Card Scam

In certain markets, such as Southern California and Washington State, independent escrow agents handle real estate closings. They order the title insurance from a title insurance company that has a sub escrow division to process payments for… READ: ANATOMY of an Altered Demand Payoff

Fraud was presented to a title agent in a rather unusual way: It was a $500,000 cash sale, no loan involved. The standard Huntsville, Alabama Board residential contract listed a Mr. Squatter and his wife as buyers. Though the contract had been… READ: FALSE Pregnancy

The amount of liability of a policy of title insurance will depend upon the type of coverage. Typically, the owner’s title policy is based upon the purchase price or fair market value of the property being purchased… READ: HOW Much Does Title Insurance Cost?

IN THIS ISSUE:

Offices closing commercial transactions are not immune to the diverted wire transfer scam. In fact, in most cases they are more vulnerable since they are usually wire transferring funds in the millions of dollars. Read “MULTI-MILLION dollar loan payoff scam” to discover how a manager of a title agency recently prevented a diverted wire transfer scam in a commercial refinance transaction.

Escrow and title companies do not accept cash of any kind. There are far too many risks involved. It is unsafe for employees to accept cash at an office since they do not have a place, such as a theft proof safe, to store the cash. In addition, they do not have the means to secure the cash for delivery to the bank for deposit.

Banks are highly regulated and must report cash deposits to federal agencies. Cash deposits at a bank trigger reporting which would be done in the name of the remitter or settlement agent — not the customer. Read “CA$H money” for the last and biggest reason why settlement agents cannot accept cash at their offices.

In this month’s article on the value of title insurance, we provide a detailed description of the industry’s most commonly issued report called the Commitment. Discover what it is and what it is not in the article entitled “WHAT is a commitment for title insurance?”

IN THIS ISSUE:

For many years flipping real estate was deemed a negative term. Many thought flipping properties was illegal. The negative reputation was well earned, since most mortgage fraud cases involved someone who flipped real estate to a straw buyer who would obtain a new loan to purchase the property. The straw buyer would never make a payment leaving the lender the last one standing with an unpaid loan, which was never worth the loan amount. Clearly, that kind of flipping is illegal.

In recent years, television networks have helped highlight positive investors flipping real estate through television shows featuring real estate investors who find homes in need of rehabilitation. These investors fix the properties up and then sell or flip them to legitimate, qualified homebuyers. This all happens in a few months or less — hopefully for a profit.

Unfortunately, some people want to be real estate investors, but do not want to put in the real work. They look for short cuts and have less than honest intentions. Read “FLIP or fraud?” for details about how one man attempted to build his investment portfolio by flipping real estate.

“CALLER ID spoofing” is a story detailing one of the latest trends in the diverted wire transfer scam being perpetrated against home buyers. The fraudsters are using internet applications to blind the numbers they are using to call and text home buyers, instructing them to wire their down payment funds to an account other than the settlement agent’s or title company’s account.

Title Officers search the records and analyze the information discovered as a result of that search. They are highly skilled professionals who are experts in searching chains of title for risks. Read “PEOPLE behind a title policy” to discover how valuable title officers are to the industry.

IN THIS ISSUE:

Some thieves use a mask to conceal their identity; others lurk in the shadows. The internet offers intruders the ability to do both — virtually. Hackers lurk in hidden corners of the web tracking the progress of real estate transactions waiting for just the right time to strike. Who are their targets? Everyone is their target! The hackers’ end goal is to convince someone to wire transfer their funds to an alternate account.

The Company continues to receive reports describing attempts to divert proceeds, down payments and payoffs from real estate transactions. Fortunately, we continue to receive reports from our hardworking colleagues who have been successful in thwarting these attempts. All disbursements are vulnerable. Read “BREAKING and entering” for details of how Deborah Cash, from Ticor Title Company in Riverside, California, thwarted one such attempt.

The story entitled “DEAD or not” provides a detailed account of how an escrow officer discovered the seller in her transaction had died prior to closing. Everyone involved in the transaction was trying to cover it up, including the listing agent, selling agent and buyer’s new lender. The escrow officer used an internet search to discover an obituary posted in the name of the seller.

Generally speaking, public records give constructive notice of matters affecting title, according to the state statutes where the land is located. Read “TITLE records” for more details on where and how the search is performed.

© 2019 TICOR TITLE COMMERCIAL All rights reserved.