Seller impersonation fraud is on the rise. A study conducted by NDP Analytics found that 28% of title companies experienced at least one seller impersonation fraud attempt in 2023, and in April 2024 alone, 19% of firms experienced at least one of these attempts.
The study, which was released on Monday, is based on a nationwide survey of 783 title companies. Of the firms that experienced seller impersonation fraud attempts in 2023, only 16% paid claims, according to the study.
Despite the seemingly common occurrence of seller impersonation fraud, 46% of respondents reported that it was at least “somewhat common” to catch fraud attempts before closing, while 26% said it was more common to catch fraud after closing.
The most common characteristics of seller impersonation fraud are notarization issues, with 43% of respondents noting that fake notary credentials appeared in seller impersonation fraud attempt, and 31% reported that a fraudster attempted to use a real notary’s credentials without permission.
According to the report, real estate and title professionals should keep a close eye on vacant land transactions, as well as all-cash transactions and deals where the seller requests the use of an unknown notary. Requests for all-cash transactions and mail-away signings were cited as “somewhat common” red flags by more than 80% of survey respondents.
The good news, however, is that 91% of the title firms surveyed provide or plan to provide education and resources to train employees on fraud. And 69% of surveyed firms reportedly utilize resources from the American Land Title Association (ALTA).
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