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The Next Generation of Real Estate Fraud: The 10 AI Scams Every Realtor Needs to Know · Dishin' Dirt with Gary Pickren

0:03
SPEAKER_01: If you were designing the perfect real estate scam today, and you want to use artificial intelligence to help you, what would that scam look like?
0:12
SPEAKER_01: What would be the final product?
0:13
SPEAKER_01: Today we're going to talk about that because it's something that frankly scares me about every real estate transaction today.
0:19
SPEAKER_01: And I think it's something that maybe not happening on a regular basis, but is starting to happen more frequently, that we have to be more aware of and protect the industry from.
0:29
SPEAKER_01: Because we know that artificial intelligence has been tremendously helpful for real estate agents, closing attorneys, mortgage companies, getting more efficient, doing better jobs.
0:38
SPEAKER_01: But at the same time, artificial intelligence has helped criminals become better criminals.
0:44
SPEAKER_01: It's helped them write better emails, correct their grammar, have better fake identification documents, how to look at their scam and figure out where the weaknesses are and fix those weaknesses.
0:54
SPEAKER_01: Now, before you tune out today and say, I don't need another episode about why AI is evil, that's not what we're talking about here.
0:59
SPEAKER_01: It's not about chat GPT or robots taking over the world.
1:02
SPEAKER_01: What we're talking about today is potentially your next closing, the next time you have a closing schedule, because maybe in that closing you have a seller that you've never met before.
1:10
SPEAKER_01: They're out of state or claim to be out of state.
1:13
SPEAKER_01: You've got a buyer who's going to wire in hundreds of thousands of dollars.
1:16
SPEAKER_01: You've already worked with this lender dozens of times.
1:18
SPEAKER_01: It's the closing attorney you always use, hopefully Blair Cato.
1:21
SPEAKER_01: Everything looks completely normal.
1:22
SPEAKER_01: Everything makes sense.
1:23
SPEAKER_01: Every email's normal.
1:24
SPEAKER_01: Every document looks authentic.
1:26
SPEAKER_01: Every phone call you have looks and sounds legitimate.
1:29
SPEAKER_01: And yet, this entire transaction has been hijacked by someone you've never met, and probably someone who's never even lived in the United States, probably never even been to the United States.
1:38
SPEAKER_01: But that's where we're headed.
1:39
SPEAKER_01: For years we've been talking about wire fraud, wire fraud, wire fraud, biggest problem in industry.
1:43
SPEAKER_01: And it still is a problem.
1:45
SPEAKER_01: We've also talked about fake checks and forged deeds and all of those things.
1:48
SPEAKER_01: But AI changes something fundamentally.
1:51
SPEAKER_01: It doesn't invent new crimes.
1:53
SPEAKER_01: It simply makes these old crimes nearly impossible to detect because for decades, criminals had one major weakness.
2:00
SPEAKER_01: They weren't very smart.
2:01
SPEAKER_01: They weren't very good at it.
2:02
SPEAKER_01: Their grammar was terrible.
2:04
SPEAKER_01: Their fake IDs, their fake documents all looked fake.
2:07
SPEAKER_01: The emails sounded very awkward.
2:09
SPEAKER_01: They made weird promises about Nigerian princes and stuff of that nature.
2:13
SPEAKER_01: Their fake driver's license were very easy to spot.
2:16
SPEAKER_01: But today, those weaknesses are quickly disappearing because AI can actually write better emails than most humans.
2:23
SPEAKER_01: It can clone your voice.
2:24
SPEAKER_01: It can clone your identity.
2:26
SPEAKER_01: It can create flawless documents.
2:28
SPEAKER_01: It can create realistic driver's license and passports.
2:30
SPEAKER_01: It can even hold conversations with victims who don't know they're talking to a computer instead of a human being.
2:35
SPEAKER_01: Criminals are getting smarter not because they're actually getting smarter, they're getting smarter because they're using better tools or using artificial intelligence.
2:43
SPEAKER_01: Today we're going to walk through 10 fraud schemes that every real estate professional needs to understand.
2:48
SPEAKER_01: Most of these are new schemes or newer schemes.
2:51
SPEAKER_01: Some are already happening, some are just beginning, and one, I believe, could become one of the biggest threats in our industry.
2:57
SPEAKER_01: So today on Dish and Dirt, we're going to cover these 10 new AI-based fraud schemes and a whole lot more.
3:04
SPEAKER_00: This is Dish and Dirt with Gary Pickren, South Carolina's only podcast dedicated to the real estate agent craft.
3:11
SPEAKER_00: And now the host of Dish and Dirt, Gary Picker.
3:14
SPEAKER_01: Hians and welcome back, everyone, to another episode of Dish and Dirt.
3:17
SPEAKER_01: I'm your often opinionated but rarely wrong host, Gary Pickerin, coming to you from the beautiful downtown Columbia South John offices of Blair Kato Picker and Castellon, this, the first week of August 2026.
3:27
SPEAKER_01: Well, artificial intelligence did not invent fraud.
3:30
SPEAKER_01: That's without a doubt.
3:31
SPEAKER_01: People have been forging deeds for decades.
3:33
SPEAKER_01: They have impersonated sellers for decades.
3:35
SPEAKER_01: They've used fake deeds, fake documents, fake wiring instructions, fake IDs, done all of that.
3:40
SPEAKER_01: They've stolen identities forever.
3:42
SPEAKER_01: But AI has changed three things.
3:44
SPEAKER_01: First, it has made fraud very inexpensive.
3:47
SPEAKER_01: Secondly, it's made fraud extremely scalable.
3:51
SPEAKER_01: And third, it's made it very believable.
3:54
SPEAKER_01: Twenty years ago, if you wanted a fake driver's license, you needed graphic design skills.
3:59
SPEAKER_01: And even then, you could tell the difference in fonts and photo layovers.
4:03
SPEAKER_01: But today, you need about five minutes and a very good AI image generator.
4:08
SPEAKER_01: Years ago, if you wanted to impersonate somebody, you had to either look like them or sound like them.
4:12
SPEAKER_01: Today, all we need to do is download your social media.
4:15
SPEAKER_01: Imagine that for a second.
4:16
SPEAKER_01: I've recorded hundreds of podcast episodes.
4:19
SPEAKER_01: Every agent has probably spoken at a convention or a CE class, posted tons of Instagram and videos.
4:26
SPEAKER_01: Every lender's been out posting YouTube videos, attorneys themselves.
4:29
SPEAKER_01: We've given criminals exactly what they need to clone our voice and to clone our images.
4:35
SPEAKER_01: This isn't science fiction anymore.
4:36
SPEAKER_01: This isn't the Jetsons.
4:38
SPEAKER_01: It's commercially available technology that costs very little money and is very accessible.
4:44
SPEAKER_01: And that's why everyone listening today has to think about fraud differently.
4:48
SPEAKER_01: We can no longer ask, can someone fake this?
4:51
SPEAKER_01: Because the answer is yes, they can fake anything.
4:53
SPEAKER_01: What we have to ask now is, can I really trust my eyes and my ears?
4:57
SPEAKER_01: Can I trust what I'm seeing and what I'm hearing?
4:58
SPEAKER_01: And those are two very different questions and two different ways of looking at this.
5:01
SPEAKER_01: So let's start with fraud number one, the perfect fake seller.
5:05
SPEAKER_01: I think this is one of the biggest threats facing listing agents today.
5:08
SPEAKER_01: Seller impersonation.
5:09
SPEAKER_01: We've seen it already in South Carolina with vacant lots and vacant houses.
5:13
SPEAKER_01: Imagine this: an agent gets a phone call of some woman who says, you know, my mom or dad are sick.
5:18
SPEAKER_01: I've got this vacant piece of land.
5:20
SPEAKER_01: I need to sell this very quickly because I need the money so I can help pay for these medical bills.
5:25
SPEAKER_01: She lives in another state.
5:27
SPEAKER_01: She needs to sell it quickly.
5:28
SPEAKER_01: Everything seems reasonable.
5:29
SPEAKER_01: And now they actually are getting very good at their identification.
5:33
SPEAKER_01: In the past, if they sent you an ID, it was clearly fake.
5:36
SPEAKER_01: But today they're getting driver's license, passports, utility bills, tax bills, and all kinds of documents to you that look legit.
5:44
SPEAKER_01: Everything matches.
5:45
SPEAKER_01: The attorney can perform the title work.
5:47
SPEAKER_01: Nothing looks unusual.
5:48
SPEAKER_01: The seller signs remotely, the notary verifies identity, the money's wired, the recordings occur, and everyone celebrates.
5:56
SPEAKER_01: Except, again, the real owner has absolutely no idea their property's been sold.
6:00
SPEAKER_01: How can this continue to happen?
6:02
SPEAKER_01: It's because every piece of identification that they're using now are generated or altered by AI.
6:07
SPEAKER_01: They're not doing it themselves anymore like they were two or three years ago.
6:11
SPEAKER_01: The driver's license will look authentic.
6:13
SPEAKER_01: The passport will look authentic.
6:15
SPEAKER_01: The seller will even try to appear on Zoom because it's not even their images anymore.
6:19
SPEAKER_01: It's all deep fakes.
6:21
SPEAKER_01: And that's the scary part.
6:22
SPEAKER_01: We're entering an era now where someone on video no longer proves identity.
6:26
SPEAKER_01: For decades we could trust our eyes, but AI is teaching us that our eyes may become the least reliable verification tool we have.
6:34
SPEAKER_01: And that's why it's very important we still have live notaries meeting with these people and getting their actual documents and not relying on documents that were sent electronically.
6:43
SPEAKER_01: It's easy to create electronically, it's a lot harder to create the actual document.
6:47
SPEAKER_01: We'll talk more about how to defend some of these as we move along.
6:50
SPEAKER_01: Let's talk about fraud number two, QR code wire fraud.
6:54
SPEAKER_01: We've spent the last 10 years or so talking to consumers about one simple rule: never trust wiring instructions sent to you by email.
7:02
SPEAKER_01: And that message has worked.
7:04
SPEAKER_01: I think buyers have become very skeptical.
7:06
SPEAKER_01: The agents have done a great job on this, reminding every single buyer and seller wiring fraud is real.
7:12
SPEAKER_01: We need to do all this verifications.
7:14
SPEAKER_01: Attorneys have reminded them, lenders are reminding them.
7:16
SPEAKER_01: Consumers have learned to look for suspicious emails.
7:19
SPEAKER_01: But criminals have also learned something too.
7:21
SPEAKER_01: They realize that people no longer trust email, so instead they're changing the message.
7:25
SPEAKER_01: And they've changed the delivery method to ready for this?
7:28
SPEAKER_01: QR codes.
7:29
SPEAKER_01: Now think about your own behavior.
7:31
SPEAKER_01: When you go to a restaurant, you scan the QR code.
7:33
SPEAKER_01: When you board an airplane, you scan a QR code.
7:35
SPEAKER_01: When you pay for parking, you scan a QR code and willfully enter all of your credit card information on this QR code.
7:42
SPEAKER_01: If you want to download an app today on your phone, you're going to enter a QR code.
7:45
SPEAKER_01: We've been conditioned to believe that QR codes are secure.
7:48
SPEAKER_01: They're not.
7:49
SPEAKER_01: After all, you can't see what's behind them.
7:51
SPEAKER_01: They feel official, they look technological, they feel safe.
7:55
SPEAKER_01: That's exactly why criminals love them.
7:57
SPEAKER_01: Imagine the scenario.
7:58
SPEAKER_01: The buyer receives what appears to be an email from the lender, the agent, the enclosing attorney.
8:02
SPEAKER_01: It doesn't contain wiring instructions.
8:04
SPEAKER_01: It simply says, for your protection, we move to secure QR code wire transfers.
8:10
SPEAKER_01: Please scan the code below using your banking app.
8:13
SPEAKER_01: Now tell me honestly, how many of your buyers would even question that?
8:16
SPEAKER_01: Especially after hearing for years not to trust email wiring instructions, for them, it feels a lot safer.
8:21
SPEAKER_01: They can scan it.
8:22
SPEAKER_01: Their banking app then opens up.
8:24
SPEAKER_01: The routing number, of course, that you're sending the money to is hidden behind the code.
8:27
SPEAKER_01: The account number is hidden.
8:29
SPEAKER_01: The buyer never actually sees where the money is going, but they still hit send.
8:33
SPEAKER_01: And just like that,$200,000 sitting in a criminal's account bounces back and forth between seven or eight banks and it's gone.
8:39
SPEAKER_01: The lesson here is important.
8:40
SPEAKER_01: Technology itself isn't trustworthy.
8:43
SPEAKER_01: Verification is trustworthy.
8:45
SPEAKER_01: Whether the instructions come to you by email, QR code, text message, secure portal, carrier pigeon, I don't care.
8:52
SPEAKER_01: The rule never changes.
8:53
SPEAKER_01: Always verify independently.
8:56
SPEAKER_01: Never use the telephone number contained in the message.
8:58
SPEAKER_01: Never use the reply button.
9:00
SPEAKER_01: Never trust a communication that delivers the instructions.
9:03
SPEAKER_01: Find the phone number you already have, call verify every single time.
9:08
SPEAKER_01: Because once that wire leaves your account, well, it's gone.
9:11
SPEAKER_01: You don't get a second chance.
9:12
SPEAKER_01: The chance of getting that money back are slim to none.
9:14
SPEAKER_01: Fraud number three, when the closing attorney calls, but it ain't the closing attorney.
9:19
SPEAKER_01: Now let me ask you this.
9:20
SPEAKER_01: What if you did verify?
9:22
SPEAKER_01: What if you actually picked up the phone?
9:23
SPEAKER_01: Would that solve the problem?
9:25
SPEAKER_01: For years the answer has always been yes.
9:26
SPEAKER_01: Today I'm not so sure.
9:27
SPEAKER_01: So let's imagine another transaction.
9:29
SPEAKER_01: The buyer receives a phone call, and the voice says, Hi, this is Gary Pickman at Black Cato.
9:33
SPEAKER_01: I wanted to let you know that we had some last-minute issues with our escrow account.
9:36
SPEAKER_01: A lender requires us to use a different account today.
9:39
SPEAKER_01: I know you're getting ready to send the wire, so I wanted to call you before you did.
9:43
SPEAKER_01: Now imagine that voice sounds exactly like mine, not similar exactly, the same cadence, talks as fast as I do, the same pauses, the same beautiful, wonderful southern accent that I have.
9:54
SPEAKER_01: The way that I emphasize words, everything, would you question it?
9:58
SPEAKER_01: Most people wouldn't because we trust voices.
10:00
SPEAKER_01: For generations, hearing someone's voice meant actually hearing the actual person, but artificial intelligence has completely destroyed that assumption.
10:08
SPEAKER_01: Today, voice cloning software can reproduce someone's speech using surprisingly very little audio.
10:13
SPEAKER_01: And in our profession, we put audio everywhere.
10:16
SPEAKER_01: Think about it.
10:17
SPEAKER_01: I mean, we're everywhere.
10:18
SPEAKER_01: We're on YouTube, Facebook, uh, webinars, conference speeches, you name it, we're out there.
10:24
SPEAKER_01: And we willingly have created this training data for all of these programs.
10:28
SPEAKER_01: As professionals, we have built our own voice libraries.
10:31
SPEAKER_01: We never stop talking.
10:33
SPEAKER_01: We never stop giving people opinions in videos.
10:36
SPEAKER_01: But what happens if someone else starts taking our voice and using it to talk as us?
10:41
SPEAKER_01: Now, I'm not saying this to create panic for you, but what I'm saying it for is because our verification procedures have to evolve.
10:47
SPEAKER_01: In the future, verification by voice alone may not be enough.
10:51
SPEAKER_01: We may need multi-factor verification for real estate transactions.
10:54
SPEAKER_01: It may be a secure portal like Blair Cato already has, a known telephone number, a unique transaction code.
11:00
SPEAKER_01: Maybe attorneys have to begin using authenticated video platforms.
11:04
SPEAKER_01: Maybe we establish verbal passphrases with clients at the beginning of every transaction.
11:09
SPEAKER_01: I don't know exactly what the solution is going to be, but I do know this.
11:12
SPEAKER_01: If your fraud prevention strategy is I'll just call them, that strategy may not be sufficient years from now.
11:17
SPEAKER_01: Number four, the social media hijack.
11:20
SPEAKER_01: This one's really something.
11:21
SPEAKER_01: We've spent years protecting our email accounts.
11:23
SPEAKER_01: We use strong passwords, multi-factor authentication.
11:26
SPEAKER_01: We use encrypted messages.
11:28
SPEAKER_01: But where do many consumers now communicate with their real estate agents?
11:32
SPEAKER_01: They're not emailing.
11:33
SPEAKER_01: This new generation won't email, and even texting them gets harder.
11:36
SPEAKER_01: They're using Facebook Messenger, they're using Instagram, LinkedIn, even TikTok.
11:41
SPEAKER_01: Now imagine a criminal gains access to one of your social media accounts.
11:45
SPEAKER_01: Not your email, your social media account, whether it's a Facebook or a TikTok account.
11:49
SPEAKER_01: The criminal now has years of conversations, videos, photos, personal relationships, but most importantly, they now have credibility.
11:56
SPEAKER_01: That criminal message to the buyer, congratulations, we can't wait to get you in your new home.
12:01
SPEAKER_01: Nothing suspicious.
12:02
SPEAKER_01: A day later, here's the checklist for closing.
12:04
SPEAKER_01: Still nothing suspicious.
12:05
SPEAKER_01: Finally, the attorney asked me to send over the updated wiring instruction.
12:09
SPEAKER_01: Would the buyer question that?
12:10
SPEAKER_01: Probably not, because it came from the real estate agent's actual social media account, not a fake profile, the real one.
12:16
SPEAKER_01: That's why cybersecurity today isn't just about protecting your email, it's about protecting your entire digital identity.
12:23
SPEAKER_01: Every social media account you own, cloud storage account you own, every password, every place where your clients interact with you is dangerous because criminals no longer need to impersonate you or break into your email.
12:35
SPEAKER_01: Sometimes they can simply become you by getting into your social media.
12:38
SPEAKER_01: Now, we've covered four frauds already, and you may be thinking that all these sound like identity theft, but the next few schemes are very different.
12:46
SPEAKER_01: Some don't involve stealing money immediately, some don't involve stealing property.
12:50
SPEAKER_01: Instead, they exploit something that's becoming incredibly easy to fake in the age of artificial intelligence, and that is trust.
12:56
SPEAKER_01: So let's talk about number five, appraisal fraud, value manipulation.
13:00
SPEAKER_01: This is the type of fraud that many people think disappeared after 2008's financial crisis.
13:05
SPEAKER_01: It didn't.
13:05
SPEAKER_01: It simply involved.
13:07
SPEAKER_01: When most people hear the words appraisal fraud, they immediately think about the housing, the housing crash.
13:11
SPEAKER_01: They remember stories about appraisers being pressured into hitting the number, loans being made on homes that weren't worth what they everyone claimed they were, paperwork being manipulated to make these deals work.
13:21
SPEAKER_01: The good news is that our industry learned from that period.
13:23
SPEAKER_01: But today appraisers operate under a much stricter independence rules.
13:27
SPEAKER_01: Lenders have firewalls in place.
13:28
SPEAKER_01: You have the appraisal management companies or AMCs were created to help reduce undue influence.
13:34
SPEAKER_01: There are far more checks and balances out there than there was just 20 years ago.
13:37
SPEAKER_01: In many ways, the system's a lot better, but it doesn't mean a better system is immune to fraud.
13:43
SPEAKER_01: Fraud has simply become more sophisticated, and once again, artificial intelligence is changing the game.
13:48
SPEAKER_01: When we talk about appraisal fraud today, we're usually not talking about dishonest appraisers.
13:52
SPEAKER_01: The overwhelming majority of appraisers are very ethical professionals determined to actually find the value of the property.
13:59
SPEAKER_01: But instead, we're talking about people who are attempting to manipulate the information that reaches the appraiser.
14:04
SPEAKER_01: An appraiser can only analyze the information that is available to them.
14:08
SPEAKER_01: If that information has been manipulated, then the valuation can be manipulated.
14:14
SPEAKER_01: Artificial intelligence makes that fake evidence a lot easier to disseminate.
14:19
SPEAKER_01: Let's imagine a property owner wants to convince everyone that their house is worth$50,000 more than it really is.
14:24
SPEAKER_01: Well, 20 years ago, creating that fake evidence required real skill.
14:28
SPEAKER_01: But today, artificial intelligence can create and generate incredibly convincing supporting material, stuff like fake invoices showing renovations, altered photographs showing repairs that have been completed, fabricated contractor estimates, manipulated receipts.
14:43
SPEAKER_01: You can even have AI enhanced images to remove visible defects like foundation crack, wood rot, water intrusion.
14:50
SPEAKER_01: Now imagine those materials are presented as supporting documents during the appraisal process.
14:55
SPEAKER_01: The appraiser still performs an independent inspection, but if the supporting documents appear legitimate, they can influence the overall understanding of the property's conditions and improvement.
15:04
SPEAKER_01: That's a real concern.
15:05
SPEAKER_01: AI doesn't have to fool the appraiser completely.
15:08
SPEAKER_01: It only has to create enough uncertainty to make bad information seem plausible.
15:12
SPEAKER_01: And another concern is comparable sales or comps.
15:14
SPEAKER_01: Those are the backbones of residential appraisals.
15:16
SPEAKER_01: But what happens if someone intentionally misrepresents comparable properties?
15:20
SPEAKER_01: They could claim the house had a brand new roof, it didn't.
15:22
SPEAKER_01: The one had a finished basement, it didn't.
15:24
SPEAKER_01: The sale included no concessions.
15:26
SPEAKER_01: Well, actually, the seller paid about$25,000 in concessions.
15:29
SPEAKER_01: Those details matter, and artificial intelligence can now produce very polished summaries, spreadsheets, property comparisons that look professional enough to be accepted at the face value unless independently verified.
15:40
SPEAKER_01: Again, the technology isn't creating the fraud, it's making the fraud look more credible so that the person doesn't double-check it.
15:46
SPEAKER_01: So could AI influence appraisers?
15:48
SPEAKER_01: Well, the bigger question is many appraisers are already probably using artificial intelligence to improve efficiencies.
15:53
SPEAKER_01: Here's a risk.
15:54
SPEAKER_01: What happens if AI summarizes inaccurate information or confidently repeats fabricated information that's found its way into the public or private data sources?
16:04
SPEAKER_01: Well, we've all heard the phrase garbage in, garbage out.
16:07
SPEAKER_01: That principle still applies.
16:09
SPEAKER_01: Artificial intelligence doesn't magically make bad information good.
16:13
SPEAKER_01: It simply processes information faster.
16:15
SPEAKER_01: So the takeaway and the lessons for the realtors and the real estate agents to understand is don't assume because a document looks professional that it's authentic.
16:23
SPEAKER_01: Don't assume because photographs look real that they haven't been altered.
16:27
SPEAKER_01: Don't assume because AI have produced a very impressive report that the underlying information has been verified.
16:33
SPEAKER_01: The most valuable skill in real estate may no longer be finding information.
16:38
SPEAKER_01: It may be verifying the information is actually true.
16:41
SPEAKER_01: Now let's talk about number six, getting scammed twice.
16:43
SPEAKER_01: This is one of the cruelest scams I've ever seen.
16:45
SPEAKER_01: Imagine if you're a victim of wire fraud.
16:47
SPEAKER_01: You're embarrassed by it, uh, you're devastated, you lost$100,000, you've reported it to the FBI, law enforcement, maybe your bank.
16:55
SPEAKER_01: And then two weeks later, somebody calls and says, There's special agent Johnson with the Federal Bureau of Investigation.
17:00
SPEAKER_01: I've gotten good news.
17:01
SPEAKER_01: We've located your money.
17:02
SPEAKER_01: It's great relief, right?
17:04
SPEAKER_01: But then there comes a catch.
17:05
SPEAKER_01: We need to verify your identity and we need to access your account.
17:08
SPEAKER_01: There's also a small recovery fee.
17:10
SPEAKER_01: What they're doing is they're being robbed the second time.
17:12
SPEAKER_01: And it's called a recovery scam.
17:13
SPEAKER_01: And it's becoming increasingly sophisticated.
17:16
SPEAKER_01: Criminal organizations are sharing these victim lists.
17:19
SPEAKER_01: Once someone has been successfully scammed once, they view you as a prime target for another scam.
17:23
SPEAKER_01: And AI is making these scams even more convincing because you're receiving an email that matches the FBI template.
17:29
SPEAKER_01: You get a video message featuring a government official, there's a phone call, maybe using a clone voice, official looking case numbers, realistic badges and credentials.
17:37
SPEAKER_01: Everything's looking legit, sounding legit, except it's not.
17:41
SPEAKER_01: And here's a lesson: government agencies don't charge you to recover stolen money.
17:44
SPEAKER_01: If someone contacts you claiming they can help you recover your funds, you have to independently verify the claim using official contact information, not the number or the website they provided.
17:55
SPEAKER_01: They can spoof telephone numbers.
17:57
SPEAKER_01: Number seven, the fake notary.
17:58
SPEAKER_01: Now, I'm going to turn to something here that's particularly important to attorneys.
18:02
SPEAKER_01: Remote online notarization has been one of the most significant innovations in our industry.
18:06
SPEAKER_01: It's made closings easier and faster.
18:08
SPEAKER_01: It's very convenient, especially for military families and international clients.
18:11
SPEAKER_01: We don't have it yet here in South Carolina.
18:13
SPEAKER_01: We still require you to sign the documents live in front of a notary.
18:16
SPEAKER_01: But imagine if closing attorneys allowed the seller to control the notary signing process.
18:22
SPEAKER_01: A seller could use a fake notary.
18:25
SPEAKER_01: And so now you have a document that never was notarized, and so it's an invalid document.
18:29
SPEAKER_01: Or perhaps the seller is fake, they're not who they say they are.
18:33
SPEAKER_01: And so then they're going to control the notary process and just fake a notary signature.
18:38
SPEAKER_01: The notary there to protect.
18:40
SPEAKER_01: That's why we have the live notary.
18:42
SPEAKER_01: We need that live notary there to verify the documents.
18:45
SPEAKER_01: Because again, it's easy to create fake electronic documents.
18:49
SPEAKER_01: It's a lot harder to have the documents that you can provide to the notary where they can verify that driver's license.
18:54
SPEAKER_01: They can verify that passport.
18:56
SPEAKER_01: Most of the time, the criminal doesn't want to meet with a real human being.
19:00
SPEAKER_01: And so they will stop that crime.
19:03
SPEAKER_01: Closing attorneys, we need to continue to educate our clients and the agents that we have to use our trusted providers or notaries that can actually go and meet live face-to-face with the seller to verify identity.
19:16
SPEAKER_01: Number eight, the rental fraud that never ends.
19:18
SPEAKER_01: And how this works is a scammer finds a legitimate listing.
19:21
SPEAKER_01: Sometimes it's on Zillow, Realtor.com, maybe it's on the MLS.
19:25
SPEAKER_01: Sometimes the house isn't for rent.
19:26
SPEAKER_01: Sometimes it's just for sale.
19:28
SPEAKER_01: And they copy all the photos, they copy the descriptions, they copy over the address now using AI, and then they advertise that somewhere else, usually on Craigslist.
19:36
SPEAKER_01: And they offer a really good price because they're urgent to get somebody in this house.
19:40
SPEAKER_01: It's not suspiciously cheap, it's just a really good deal.
19:44
SPEAKER_01: And the house looks great because they may have gone in and doctored the photographs of the house to make the house look even better.
19:49
SPEAKER_01: So a prospective tenant responds, the scammer is very responsive, answer every question, they send applications, lease agreements, everything looks like a professional company.
19:59
SPEAKER_01: They even probably provide you movement instructions, but it's so professionally done that it looks legit.
20:04
SPEAKER_01: And that's where AI is coming in because AI is handling the conversations.
20:08
SPEAKER_01: It's available 24 hours a day, seven days a week, and it's giving better customer service than the actual landlords could themselves.
20:15
SPEAKER_01: And everything looks great.
20:17
SPEAKER_01: The documents look wonderful.
20:18
SPEAKER_01: And then there comes a deposit.
20:20
SPEAKER_01: Because demand is high, we need first and second month's rent and the security deposit.
20:24
SPEAKER_01: We'll overnight you the keys, but we need that wire now.
20:27
SPEAKER_01: And they put the pressure on them.
20:29
SPEAKER_01: Person wires the money, absolute silence.
20:31
SPEAKER_01: Sometimes they even show up closing day looking to meet with the people at the house, finding out that somebody else lives there or that the house has been sold, and now you're stuck losing all of this money.
20:42
SPEAKER_01: This is one reason consumers should never send money for rentals without independently verifying ownership.
20:47
SPEAKER_01: And whenever possible, viewing the property in person through a trusted property manager or licensed real estate agent.
20:53
SPEAKER_01: If you're listing a property, your clients or you should continue to look as much as you can through AI, asking if these properties are for sale, is there any rental advertisements out.
21:03
SPEAKER_01: Use the tools that the criminals are using to search yourself to see if your property is being advertised in a place that you are not aware of.
21:10
SPEAKER_01: But if you notice something about all these frauds so far, every one of these schemes has something in common.
21:15
SPEAKER_01: The criminal doesn't need to be a better liar than you, they just need better technology.
21:20
SPEAKER_01: And we're not done yet because in this section now, what we're gonna do is we're gonna discuss two more emerging frauds that could really reshape the industry AI-generated home inspection reports and synthetic identity buyers.
21:32
SPEAKER_01: And then we're gonna arrive at what I think is really the future of organized crime and real estate.
21:36
SPEAKER_01: That's AI transaction hijacking.
21:38
SPEAKER_01: That's to the point where artificial intelligence stops helping criminals commit fraud and starts managing the fraud itself.
21:44
SPEAKER_01: The crime doesn't need a mastermind anymore because of AI, it just needs artificial intelligence.
21:49
SPEAKER_01: Up to this point, we've talked about criminals using AI as a tool.
21:52
SPEAKER_01: They use it to write better emails, create better fake documents, clone voices, generate fake IDs.
21:58
SPEAKER_01: But what if AI moves beyond?
22:00
SPEAKER_01: Beyond being a tool and becomes a criminal's assistant.
22:03
SPEAKER_01: What happens if it starts making decisions?
22:04
SPEAKER_01: It starts running the fraud.
22:06
SPEAKER_01: I don't think we're very far from that reality.
22:09
SPEAKER_01: Before we get there, let's cover the final two frauds that are already emerging.
22:13
SPEAKER_01: Number nine, the AI home inspection report.
22:16
SPEAKER_01: This is something that every buyer relies on, the home inspections.
22:20
SPEAKER_01: For most buyers, the home inspection is the single most important document they receive during this transaction.
22:24
SPEAKER_01: It determines whether they negotiate repairs, they walk away, they ask for credits, they proceed with the closing.
22:30
SPEAKER_01: And we've always trusted those inspection reports because they come directly from the licensed inspectors.
22:35
SPEAKER_01: But how many buyers actually know what their inspector report is supposed to look like?
22:39
SPEAKER_01: Most don't.
22:40
SPEAKER_01: Imagine what AI can do now.
22:41
SPEAKER_01: A scammer can download a legitimate inspection report, feed it into AI, change the addresses, change the photographs, and then remove all the references to structural problems, to mold problems, to leak issues.
22:56
SPEAKER_01: Add the inspector's logo, add a digital signature, create this really polished PDF, send it out.
23:01
SPEAKER_01: Now, I'm not suggesting this is a widespread problem today.
23:04
SPEAKER_01: What I'm saying is that technology now exists to make this possible.
23:08
SPEAKER_01: And once that technology exists, someone's eventually going to abuse it.
23:12
SPEAKER_01: It might not even be a criminal organization in this situation.
23:14
SPEAKER_01: It could simply be a dishonest seller who's moving out of the country or moving out of the state and is not worried about you catching on later on.
23:21
SPEAKER_01: They alter these reports, tell the buyer, I've already done the inspections, here it is.
23:25
SPEAKER_01: It could be an investor trying to flip a property.
23:27
SPEAKER_01: It could be someone trying to obtain financing.
23:29
SPEAKER_01: The inspection report's always been viewed as objective evidence, but artificial intelligence now could make objective evidence much easier to manipulate.
23:39
SPEAKER_01: And that's why I think inspectors may eventually have to move to some type of secure digital delivery system, an encrypted report, authentication requirements, verification portals.
23:47
SPEAKER_01: But the bottom line, when it comes to inspections, anyway, is a buyer should get their own inspections and not rely on inspections that the seller provides them.
23:55
SPEAKER_01: Number 10, the buyer or seller does not even exist.
23:59
SPEAKER_01: Now let's talk about something that lenders have been quietly worried about for years.
24:03
SPEAKER_01: It's called synthetic identities.
24:05
SPEAKER_01: Most people think identity theft works like this: they steal your driver's license, they open a credit card, they use your social security number.
24:11
SPEAKER_01: That's traditional identity theft.
24:13
SPEAKER_01: Synthetic identity theft is very different.
24:15
SPEAKER_01: The criminal creates an entirely new person.
24:18
SPEAKER_01: They create a new social security number, usually combining numbers together.
24:22
SPEAKER_01: They'll use somebody else's birth date, they'll create their own addresses, phone numbers, email accounts, they'll create fake employment histories.
24:29
SPEAKER_01: They slowly build up credit, they make payments, they open accounts, they become financially respectable.
24:36
SPEAKER_01: Eventually, that fictional person applies for a mortgage and everything checks out.
24:39
SPEAKER_01: The credit score, income, verification, employment, all of that looks very good.
24:43
SPEAKER_01: Even the photograph can be AI generated.
24:45
SPEAKER_01: The lender isn't lending money to a criminal, they're lending money to someone who doesn't even exist in this world.
24:51
SPEAKER_01: Now think about what artificial intelligence has changed.
24:53
SPEAKER_01: Years ago, creating an entirely fake identity required incredible effort, but today much of that process can simply be automated.
25:00
SPEAKER_01: Again, this isn't science fiction.
25:02
SPEAKER_01: Financial institutions have been fighting this synthetic identity fraud for years.
25:06
SPEAKER_01: The concern is that AI will make these identities more convincing and much harder to detect before they reach the real estate transactions.
25:12
SPEAKER_01: When you start thinking about synthetic identities, imagine how that could be done on the buyer side or on the seller side.
25:18
SPEAKER_01: Now, I want to spend the last few minutes we have talking about something that also should keep you awake at night.
25:23
SPEAKER_01: It's not something I've seen widespread yet.
25:25
SPEAKER_01: I think it's coming.
25:26
SPEAKER_01: I'm hoping I'm wrong, but I'm going to call it AI transaction hijacking.
25:30
SPEAKER_01: It's not wire fraud, identity theft, email hijacking, or even transaction hijacking.
25:35
SPEAKER_01: Here's what I think it's going to look like.
25:36
SPEAKER_01: A criminal gains access to one email account.
25:39
SPEAKER_01: That's it.
25:39
SPEAKER_01: Maybe it's the buyers, the realtors, the lenders, it doesn't really matter.
25:42
SPEAKER_01: One account.
25:43
SPEAKER_01: And in the past, the hacker would search for wiring instructions or maybe send a fake email immediately.
25:49
SPEAKER_01: But AI is changing that strategy now.
25:51
SPEAKER_01: Instead of acting immediately, the AI sits quietly, it reads every email, every attachment, every calendar invite, every contact.
25:58
SPEAKER_01: It's in there.
25:59
SPEAKER_01: It's learning who the buyer is, who the seller is, who the attorneys are, who the lender is.
26:03
SPEAKER_01: It knows everyone's writing styles, your personality, how you say things.
26:07
SPEAKER_01: It knows your schedule.
26:08
SPEAKER_01: It knows when the inspections occur, financing's due, closing dates.
26:12
SPEAKER_01: It knows all of this.
26:12
SPEAKER_01: And it waits.
26:13
SPEAKER_01: No suspicious email goes out, no spelling mistake email goes out, no strange request, nothing.
26:18
SPEAKER_01: And then about three weeks goes by, everything appears normal.
26:21
SPEAKER_01: The professionals trust one another.
26:23
SPEAKER_01: They're having very comfortable conversations in their email.
26:26
SPEAKER_01: Everybody's excited, and the closing's tomorrow.
26:28
SPEAKER_01: Then at exactly the right moment, the AI sends out that one email, not 10, only one.
26:33
SPEAKER_01: Maybe it comes from a lender, maybe it comes from the attorney with a spoofed email.
26:37
SPEAKER_01: Maybe it comes from the real estate agent, and it says something that's quite believable.
26:40
SPEAKER_01: A compliance issue identified during our final funding review, our escrow account has changed.
26:45
SPEAKER_01: Please use the attached instructions.
26:47
SPEAKER_01: Or maybe it says a lender requested one final verification before funding.
26:51
SPEAKER_01: Please complete the secure payment confirmation.
26:54
SPEAKER_01: There's no grammatical errors, nothing strange in the wording.
26:57
SPEAKER_01: There's no promise of a Nigerian princess for you when you do it.
27:00
SPEAKER_01: There's no warning signs at all because AI has been studying the transaction now for weeks.
27:05
SPEAKER_01: It's starting to write exactly like an attorney or the lender or the agent.
27:09
SPEAKER_01: It references conversations that actually happened.
27:11
SPEAKER_01: It knows the buyer's children's name.
27:13
SPEAKER_01: It knows the property address, the closing date.
27:15
SPEAKER_01: It signs the email the exact same way you sign out of an email.
27:18
SPEAKER_01: Now ask yourself, would you catch this?
27:20
SPEAKER_01: Honestly, would you catch this?
27:21
SPEAKER_01: I'm not sure I would.
27:23
SPEAKER_01: And that's what makes this different.
27:24
SPEAKER_01: We have spent years teaching people to spot suspicious communications based on the grammar, based on the punctuation.
27:31
SPEAKER_01: But what happens if there is no suspicious communication when the fraudulent email is actually better written than a legitimate one?
27:38
SPEAKER_01: And that's the future challenge.
27:40
SPEAKER_01: Now, I don't want anyone leaving this episode thinking the answer of this is just simply fear.
27:44
SPEAKER_01: It isn't.
27:44
SPEAKER_01: The answer is better systems.
27:46
SPEAKER_01: For decades, our industry has had to rely on trust, and trust is still essential, but trust can no longer rely solely on appearances.
27:53
SPEAKER_01: We need layered verification.
27:55
SPEAKER_01: We need secure communication platforms.
27:58
SPEAKER_01: We need multi-factor authentication.
28:00
SPEAKER_01: We need identity verification that does not depend on one document, one email, or simply one phone call.
28:05
SPEAKER_01: We need to assume that anything digitally can be manipulated.
28:09
SPEAKER_01: We know it can.
28:10
SPEAKER_01: Not because we have to become cynical assholes, but because we're professionals.
28:13
SPEAKER_01: And here's what I think is the biggest takeaway from today's discussion.
28:17
SPEAKER_01: Artificial intelligence is not the villain, it's the amplifier.
28:20
SPEAKER_01: The same technology that's helping closing attorneys draft documents, that help agents market houses, that help lenders process loans, helps inspectors write reports.
28:29
SPEAKER_01: It's also available to criminals.
28:31
SPEAKER_01: Technology itself is neutral.
28:33
SPEAKER_01: It's how people choose to use technology that determines whether it becomes a tool for progress or a weapon for deception.
28:40
SPEAKER_01: Now, next week I want to continue this conversation by discussing how real estate professionals can redesign their business to survive the age of AI fraud.
28:49
SPEAKER_01: I don't think the question is whether these threats are coming.
28:52
SPEAKER_01: I think they're already here.
28:54
SPEAKER_01: The real question is: will our industry procedures evolve as quickly as the criminals technology?
29:00
SPEAKER_01: And that may become one of the defining questions for the future of real estate.
29:03
SPEAKER_01: All right, that's all the time we have for Dish and Dirt today.
29:05
SPEAKER_01: I hope you like it.
29:06
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29:08
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29:11
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29:15
SPEAKER_01: I hope everybody has a wonderful weekend, and we'll see you again next week for another episode of Dishing.