Be Aware of Fraudulent Buyers

Posted by Michelle Farber Ross on Friday, December 12th, 2014 at 2:17pm.

The Importance of Checking - REALLY CHECKING- Buyers Financial Capacity

By: Michelle Ross

I received a call yesterday to show one of my multi-million dollar listings. My first reaction, of course, was delight. After getting a bit of history from the gentleman who called me, I told him that our protocol was to always verify either proof of funds or a letter of financial capacity prior to the showing. I gave him my email address and told him I would confirm the showing once the documentation was verified.

**I want to interject a few thoughts here: 1) If a buyer gets offended that you are asking for these types of credentials, then the chances are they are NOT LEGIT! 2) It is incumbent upon you, as the listing agent to thoroughly check the credentials once received. Your sellers are entrusting their valuables, safety and peace of mind with you - DO NOT TAKE IT LIGHTLY!

Typically, for such an expensive home, I do a quick background check on the individual. Since I didn't have any documents with the exact spelling of his name, I was coming up empty. Then, I received the letter of financial capacity and called the number on it. The number was not in order. So, I called the "buyer" back and told him of this. He provided the wealth manager's direct line. I called that and spoke with him. I asked the wealth manager for an office number so I could verify. He gave me the number for the office he said he worked at in NY. I finally called the office in NY and asked for the gentleman, with whom I had just spoken. **Surprise - he doesn't exist.

At that point, I told my sellers that there would be no showing and left it alone. I did additional background checks on the names spelled per the letter of financial capacity. Again, came up empty. *****Another tip: If an individual is looking to purchase a home valued over $8 Million, then locating them on the internet should not only NOT BE DIFFICULT, it should be easy! An $8 Million home is afforded by buyers worth over $20 Million (a person who has made his/her mark in the business, celebrity, sports or other worlds).

So, fast forward to this morning, I received a call fifteen minutes before the schedule time that I was supposed to show the "Buyer." He informed me that he would meet me at the property. I asked him to meet me at my office.

Twenty minutes later three gentlemen appeared. They sat in our conference room and I explained that I didn't want to offend anybody, but the letter and the wealth manager do not check out. He looked me straight in the eye and denied any wrong-doing. I insisted that I get the Finance company on the polycom so he may ask for his financial advisor. He did on the speaker and the receptionist informed us that the name he asked for doesn't work at the office.

The three gentlemen played the charade a bit longer, then finally declared, "Forget the house." I again apologized, if anyone was offended, but that my first priority is to protect my clients and if they can provide information that does check out, I'd be happy to accommodate.

In our meeting, the "Buyer" gave the name of his "sister" who recently sold his home and gave the spelling of the last name. (Of course, the spelling was different than that provided in the letter). So I jumped on the computer and did a thorough search. AHA: The buyer is a felon, currently on parole or on the run. I immediately called the local police to give them all of the information I had. Then I notified my sellers to be aware that this had occurred.

The "buyer" has since called another broker to gain access to my listing. The police are aware and are currently investigating.

Yours truly,

Michelle Farber Ross

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