Texas Secure Title: Leaning on Protocol in the Fight Against Fraud
If there is one thing real estate and title insurance professionals know, it’s that fraud is a massive problem. In fact, nearly 3 in 4 firms reported in 2023 that they had experienced an increase in seller impersonation. The serious threat has long been on the radar of the folks who work at Texas Secure Title Insurance Agency. “We put the security of our transactions at the top of our priority list. This is a shared responsibility – from the time the file opens until it is closed,” said Renee Hicks, Vice President of Operations.
Having a collective commitment to security paid off recently when Texas Secure confronted two suspicious real estate deals. By adhering to their tried-and-true policies, they foiled the fraudulent transactions and were recognized by the Alliant National Crime Watch program. Let’s look at what happened during each transaction.
Well-founded caution
Texas Secure’s title examiner was already on high alert when they began working on the first of the two fraudulent transactions, as it was vacant property. Their caution soon proved well founded. Worrisome details emerged during the initial examination process. When the examiner searched for more information about the owner, they found a court history littered with fraudulent deeds. One of these deeds shared the same notary public and GF number as the deed involved in Texas Secure’s file. The transaction’s deed had also been submitted by the owner and not the title company – a peculiar feature that further indicated the deal was likely fraudulent.
Teasing out the connections
The second fraudulent transaction also had clear red flags, including a possible connection to the first property described above. “The Affidavit of Heirship used had a ‘GF Number’ that looked like those used in the fraudulent deeds our examiner had seen the day before,” Hicks explained. The fact that the property was conveyed outside of the title company was another strike against it.
Digging into the details, Texas Secure found that the property owner had allegedly signed a “Texas General Warranty Deed” in 2022 to another party and filed an Affidavit of Heirship (AOH) for someone deemed to be his wife. By utilizing the online database “Find a Grave,” Texas Secure cross-referenced the name of the owner’s wife and discovered that the owner had died in 2018 – meaning that he could not have signed the deed, and that the transaction was fraudulent. Corroborating this further was that signatures on the deed and the AOH did not match.
Always adhere to policy and protocol
“It can be tempting to bypass certain standards, steps, or protocols to save time or because of long-standing relationships with other real estate or financial professionals,” said Hicks, reflecting upon the fraudulent transactions. “However, our team understands the impacts to all stakeholders when proper protocols are not followed. There is more at stake than closing the deal.”
Indeed, Texas Secure’s experience during this ordeal is a crucial reminder of how important it is to scrutinize each aspect of a given transaction. Moving methodically and always adhering to protocol is key to combatting fraud, preventing future claims, and most importantly, protecting transaction stakeholders from becoming victims.
A never-ending fight and a worthy payoff
Texas Secure’s story also speaks to the frustrating, albeit necessary, fight against fraud within the title industry. As Hicks remarked, “Will we ever be able to eliminate fraud? Of course not! However, we as an industry can rally together and have each title professional accountable for carrying out the necessary steps to secure real estate transactions.”
While there may never be a cure-all for this endemic problem, adhering to company policies, staying mindful of industry best practices, and remembering the stakes involved for property buyers and sellers can make a major difference.
And as Hicks highlighted, the emotional payoff for doing so can be tremendous. “It is rewarding to know the efforts and time we put into continuously creating new policies and procedures to safeguard our company and our underwriters is paying off,” she said. “Our examiner, Lizzie Angle, was especially excited. She felt her daily efforts were validated. Thorough, accurate and proper examination is part of the defense strategy against fraudsters.”
Want to learn more about the Alliant National Crime Watch program or submit your agency’s story. Check out the details here.
Tags: crime, crime watch, fraud, real estate, texas