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Police in Southampton, New York, are warning realtors and homeowners to be on the lookout for "out of town" fraudsters hoping to make a quick buck by flipping exclusive properties they do not actually own.
The scams are seeing a "sharp increase" in the Long Island hot spot, where most homes are second homes, and could be even easier to pull off in other vacation destinations around the country, where real estate attorneys aren't always involved in transactions, experts tell Fox News Digital.
"Criminals posing as property owners contact real estate agents to represent them in negotiating the sale of lien-free, vacant land, and can successfully defraud a potential buyer by accepting a transfer of funds to an out of town account," police said in a statement.
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Waterfront homes in Southampton, New York, on Wednesday, May 22, 2024. The summer hot spot is facing a rash of would-be real estate scammers, according to local police. (Bing Guan/Bloomberg via Getty Images)
"It's kind of been running rampant, we've even been talking about it amongst the various offices," said Zachary Scher, a real estate agent in Suffolk County. "It's not just Southampton, it's other areas out east."
Some of the scammers are easy to spot when they call from out of state and only know publicly available information, he told Fox News Digital.
"It's obvious – they're calling from a weird area code. The emails they use are silly, and then they have the information that they can find on public record, but that's it," he said. "If you probe any further, they either tell you they'll get back to you, or they want to sell it really fast."
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Waterfront homes in Southampton, New York, on Wednesday, May 22, 2024. (Bing Guan/Bloomberg via Getty Images)
A typical seller is also not in a hurry and is doing their own research on agents before committing to one, he said. Someone who calls up out of the blue and has a bullet list of information is unusual, another red flag.
"I guess it's just a new way that they're trying to find a way to scam," he said. "I wouldn’t be surprised if they start using AI to do it. I'm sure they're gonna start contacting the owners of the property, just getting them to talk, so they can get their voice. It's crazy now what they're able to do."
Scammers look for properties with no mortgage then use fraudulent identities and fake powers of attorney to fool the title company without the homeowner's knowledge, said David Gelman, a New Jersey-based attorney and former prosecutor who worked on similar cases.
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A narrow walking bridge running across a creek leading out to the Peconic Bay during sunset in Southampton, New York. (iStock)
"The only saving grace for the homeowners was there is title insurance, so they got the home back," he told Fox News Digital. "It’s a [mess] though that takes years to fix."
Red flags include secretive "sellers" who prefer text and email to meeting in person or on a video call, seeking cash deals below market value and wanting to run the listing without posting a physical for sale sign.
Police issued the warning as the summer vacation season kicks off and visitors are flocking to their favorite getaways.
"Online, it’s a lot easier for criminals to rip people off by offering products they don’t actually own," said Neama Rahmani, a Los Angeles-based trial lawyer and a former federal prosecutor. "We see this a lot with in demand items like sports and concert tickets, and properties in the Hamptons are no different."
A single-family home in Southampton, New York, on Wednesday, May 22, 2024. (Bing Guan/Bloomberg via Getty Images)
Similar scams have victimized homeowners whose houses have fraudulently been placed on listing apps like Airbnb and VRBO.
In April, a real estate agent in the neighboring town of East Hampton was shocked to find her vacation home listed by someone else on Airbnb, according to The Real Deal, an industry publication. She only learned of the scam after the potential victim reached out to her directly to ask about the requested method of payment – a wire transfer of $25,000 rather than through the app.
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Ponquogue Beach is a stretch of sand accessed by a bridge across Shinnecock Bay in the Town of Southampton, New York. (iStock)
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Police are urging realtors to take enhanced measures to verify a seller's identity. Ask for multiple forms of identification, as the scammers have been caught using fake passports. Request face-to-face meetings. Ask for details about the local area that only someone familiar with it would know. Speak with neighbors and look up the seller on social media.
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