There is no coincidence that the proliferation of the internet coincided with one of the largest housing booms in history. The value of receiving real time data was priceless when fierce competition to buy homes existed; having the information first often made the difference between getting a chance to make an offer on a home and missing out completely. Brokers, agents, and consumers readily adapted to new internet applications and technology increasing access to data and information sharing.
During the same time, the internet also became the preferred tool of the scammer. The internet offers scammers an easy venue to create false identities and find victims around the world. Although internet scams come in a variety of forms, internet real estate scams are becoming more prevalent.
To collect and research internet related criminal complaints, the Internet Crime Complaint Center (IC3.gov) was created as a collaboration between the Federal Bureau of Investigation (FBI.gov) and the National White Collar Crime Center (NW3C.org). Once known as the Internet Fraud Complain Center, the IC3 provides victims of internet crimes a “reporting mechanism” to alert authorities of possible criminal activity and/or civil infractions.
Numerous complaints regarding real estate internet scams prompted the IC3 to issue a warning in March 2010 to those who post ads on internet classified websites. Among the many forms of internet real estate scams, rental scams and duplicate real estate postings top the list.
Rental scams involve a potential tenant sending a deposit or rent check (usually without seeing the home). The scam is that the potential tenant will ask for their funds to be returned to them (either as an excess refund or a total refund) after their check is deposited in the victim’s bank account. Because the check appears to have cleared and the victim returns the funds, the victim later finds out that check was bogus and they are now responsible for the full amount of the scammer’s check.
Another scam garnering complaints is the duplication of legitimate real estate ads by scammers, posing as the home owner or real estate broker. This scam has the scammer posting a duplicate ad on internet classified sites using the wording and photos that are copied from the valid real estate ad (originally posted by the owner or the broker). The scammer creates a fake email address using the owner’s or broker’s name to make their post appear legitimate. When the victim responds to the fake post, they receive an email from the “owner” saying that the home needs to be rented while they are out of the country; the victim is asked to send funds out of the country to the “owner”.
Popular classified websites, such as Craigslist.org, warns consumers of internet scams. In addition to the warnings, Craigslist also posts tips to protect you from scammers. Craigslist says that if you follow their first tip “Deal Locally with Folks You Can Meet in Person…” you can avoid 99% of the scam attempts on their website.
FBI.gov (“Scams and Safety” link) and IC3.gov offer an extensive list of tips to protect you from real estate and other internet scams. If you are a victim of an internet scam, you can file a complaint with IC3; valid complaints are forwarded to local, federal, and/or international law enforcement and/or regulatory agencies for investigation.
By Dan Krell
Copyright © 2011
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