Real estate closings seem straightforward. You enter a contract, funds are exchanged, and you sign at the closing table. But behind the scenes these transactions are a frequent target for fraud.
The threat of fraud is not hypothetical. Every closing attorney has seen attempts involving fake sellers or attempts at misdirecting funds through email. As these schemes become more sophisticated, the tools we use as a closing law firm change, too.
One new tool we’re using is CertifID. CertifID is a national fraud prevention company that we use to help us verify identities and send and receive wire instructions. While it may feel like an extra step, CertifID helps prevent very real risks. Learn more about those fraudulent schemes from CertifID.
Why do we need to verify your identity?
Fake IDs are easy to get today, and there have been times when fraudulent sellers use them to pose as the owner of property. Property with vacant land or vacant houses are particularly susceptible to this scam. These situations will often involve stories about why the “seller” can’t attend the closing in person; perhaps they are traveling or caring for a sick relative. So now you have fake IDs that can look real in a picture and then they aren’t at closing in person. It’s important that we have a way of verifying those identities.
In our years of practice, we have seen these scenarios play out. We’ve spoken with the fraudsters by phone when they are demanding that we send the buyer’s money. In fact, we stopped a fraudulent transaction in the past week when red flags were raised—one of those red flags being the purported seller’s refusal to use CertifID to verify their identity. They weren’t very happy when we refused to wire them the tens of thousands of dollars they were hoping to get from the buyer.
Using CertifID is not about mistrust. It’s about being sure we’re dealing with the actual buyers and sellers and knowing that the transaction is a successful exchange of property and funds.
Why can’t we just email wire instructions to you?
There are a number of people involved in one real estate transaction, including the buyers, the sellers, their real estate agents, the closing attorney’s office, and the lender. But it only takes one compromised email account for a fraudster to insert themselves into the transaction and send fraudulent wire instructions. Using CertifID to securely send out our wire instructions and to receive wire instructions from the parties eliminates that threat.
There are rare instances when CertifID may not work; for example, you are outside the United States while you’re trying to access our instructions. In that case, we’ll use our Qualia portal to securely send those instructions.
Our office will not email you our full, unredacted wire instructions. Nor will we change those wire instructions. If you receive an email claiming to do that, do not send any money! Call our office using the number from our website to confirm any change.
Help us protect your investment.
Our paralegals or attorneys will send CertifID requests as part of your closing process. When you respond timely, it keeps your closing on track while protecting your funds.
We know everyone wants to get to the closing table quickly. But we also want to make sure the right people are there and that your money is sent to the right account. If you have questions at any point, please contact your paralegal or closing attorney directly. We’re always happy to walk you through the process.
