Real Estate and Fraud: Identity Verification for the Most Important Transaction of Your Life

The dream of a new home can become a nightmare if fraud is involved. Yet the real estate sector has the second-highest fraud rate of any industry — and the threat is only escalating. In 2023, the FBI received 9,521 real estate fraud complaints, with losses totaling $145,243,348. From identity theft to misinformation and wire fraud, real estate is ripe for fraud, with remote transactions, large sums of money and new tools to fool consumers and real estate professionals alike. The need for identity verification tools and procedures has never been greater.

What’s at Stake

Lack of Awareness Presents a Major Vulnerability

Consumers and real estate professionals alike are often unaware of the risk of real estate fraud and even less aware of what to do about it if they become victims. The likelihood of becoming a victim of real estate fraud, however, is a reality many consumers will face. Bad actors target 1 in 4 consumers with fraudulent communications in real estate. One in 10 will end up victims of real estate fraud.

What’s more, the awareness of the potential for fraud in such a significant process as buying a home is low. Fifty-one percent of consumers report being just “somewhat aware” of the risks of real estate fraud. Chris Mule, partner at The Title Group, a closing services company that focuses on examining and verifying titles, describes the urgency of consumers’ lack of fraud awareness: “They don’t know anything about wire fraud, and [their level of concern] is at a 4, but we need them at a 9 or a 10. This is real.”

Download the PDF for the full report

‍