Key facts
- Buyers are making unusually large escrow deposits, sometimes 5% of the purchase price.
- Suspicious buyers may delay sending proof of funds or earnest money deposits.
- Real estate agents are advised to verify buyer identities and ask standard market value questions.
- Cybercriminals may exploit real estate transactions to launder money, especially as the housing market cools.
- Property owners are advised to use owner alert systems or AI agents to monitor for fraud.
Real estate professionals are encountering increasingly sophisticated attempts at fraud, with some transactions raising red flags that suggest potential money-laundering schemes. Amanda Marcum, a broker in Kentucky, described a recent experience where a buyer made an offer with an unusually large escrow deposit and repeatedly delayed sending earnest money, prompting her to advise her sellers to walk away. Matt O’Neill, a retired Secret Service agent, noted that while risky, such schemes could appeal to criminals seeking to avoid fees associated with traditional money laundering services. He believes these tactics represent an emerging gap in the real estate system that could become more prevalent as the housing market cools and economic uncertainty rises. Cybersecurity experts warn that fraudsters may become more active, and suggest measures like owner alert systems and verifying buyer identities to combat these trends. The National Association of Realtors has also launched resources to assist agents in detecting and reporting fraud.