RPost’s PRE-Crime Protection Stops Title Insurance Fraud Before it Happens

RPost’s PRE-Crime Protection Stops Title Insurance Fraud Before it Happens

March 15, 2024 / in Blog / by Zafar Khan, RPost CEO

We’re on the cutting edge of detecting and obliterating fraudulent emails that could be the first step in a title insurance scheme.

This week, I’m visiting you from a nondescript vacant lot on the outskirts of Pasadena, California. “Armand,” you ask. “You’re a long way from Davos! You’re usually in such posh locations when you report to us for Tech Essentials.” So let this be an illustration then of the lengths I’ll go to make my reporting as authentic as possible!

This vacant lot, complete with requisite weeds growing out between the cracks in the concrete, may not look like much, but according to some land records I found, it was purchased for $5 million as the site of a new multi-family home.

But the reason you see the weeds growing and not a new development, is because it is stuck in litigation. An impostor posed as the owner, sold the land to an unsuspecting buyer, the buyer paid, received title, then the buyer put up fences getting ready for construction. Just as the bulldozers were about to plow, the REAL landowner happened to drive by and was shocked that someone was preparing to develop his property. The buyer showed their property title. The true owner said he never sold it. Hmmm… ripe for litigation and good thing for the buyer they purchased title insurance!

Cut to last week’s State of the Union address, and please note we’re not going to delve into politics here—just making an observation my armadillo brain made when watching the speech. The President calmly mentioned that he was going to ensure title insurance policies were not an obligation for new home buyers. (Just think of all the extra potato chips and snickers one could purchase with the savings. 🤣) Interesting how whole industries could be wiped out with a Presidential sound bite.

However, if there was ever a time to change this requirement, now is not it. Cybercriminals are increasingly targeting home buyers and even posing as home or vacant lot owners to sell homes that they don’t in fact own (hear more about vacant lot sales fraud here - RPost & RESPRO: Cybersecurity AI Thwarts Vacant Lot Fraud Real Estate Hijacks).

If you don’t have title insurance and purchase property from a homeowner poser, you could be out of luck. Many times, the title insurer is the one who must diligently verify every transaction and legal detail regarding the property since they have a vested interest in any transfer being legitimate. Title insurers are actually the ones on the hook if something is amiss or askew in the transaction process. So, while of course there is a cost involved in purchasing this insurance (and any other form of insurance for that matter), the value here is in deterring fraud and preventing costly investigations and lawsuits happening post-fraudulent transaction.

It may be reassuring for potential property buyers to know that, with or without required title insurance, those who use RPost technology can spot these cybercriminal schemes before the fraud, before the closing, and before the loss. 

Very recently, the American Land Title Association (ALTA) reported that AEGIS Land Title Group, one of its members, on day one after implementing RPost's PRE-Crime email security service, detected that two of AEGIS’ emails had unexpected activity in Russia. The discovery initiated an investigation that found a lender involved in a re-financing transaction was fake.

Because we’re on the cutting edge of detecting and obliterating fraudulent emails that could be the first step in a title insurance scheme, anyone not using RPost technology in a real estate transaction could in theory buy a vacant lot from an impostor owner. You’d then build/develop the property for $X dollars and end up losing everything to the true owner of the lot. This happens a lot more than you think—no pun intended.

One of my biggest nightmares as an armadillo is that my nice, grassy burrow in west Texas is actually owned by some Russian fraudster who one day shows up to kick me out and develop a matryoshka store on my former home. To learn more about PRE-Crime protection and pre-empting title insurance fraud before it happens, don’t hesitate to contact us to learn more.