No one can predict the future, but you can prepare. Find out what to prepare for and pick up the tools you’ll need at the immersive Virtual Inman Connect on Nov. 1-2, 2023. And don’t miss Inman Connect New York on Jan. 23-25, 2024, where AI, capital, and more will be center stage. Bet big on the roaring future, and join us at Connect.
Each week on The Download, Inman’s Christy Murdock takes a deeper look at the top-read stories of the week to give you what you’ll need to meet Monday head-on. This week: There are some bad actors out there. It’s up to you to protect yourself and your clients from fraudsters, scammers and cybercriminals.
Real estate agents are a hard-working lot, and they’re constantly fielding calls from new leads, new agents and out-of-town referring agents. The best agents operate with an openness and authenticity that allows them to connect with all of the people they meet in a given day. However, that same openness can put them in the path of nefarious bad actors.
When there’s a lot of money at stake, there’ll almost inevitably be people in the mix who are looking to take advantage. Whether they’re operating outside the law altogether or employing ethically questionable tactics to get more than their fair share, it’s up to everyone to pay attention when something sounds too good to be true.
Today on The Download, we’re looking at a real estate company whose practices have been called into question time and time again, then look at great advice from experts who understand how to keep yourself and your clients safe and secure.
Embattled MV Realty files for bankruptcy amid flood of lawsuits by Ben Verde
“Deliberately tricking people to make money off their homeownership is a shameful business model,” said Ohio Attorney General Dave Yost in a statement announcing his state’s lawsuit against MV Realty. Now, that Florida-based brokerage, which has been embroiled in scandal and lawsuits around allegations of deceptive business practices, has initiated a Chapter 11 bankruptcy proceeding.
The firm faces scrutiny for its lengthy 40-year contracts, through which it compensated homeowners with as little as $300 for the privilege of serving as the exclusive listing agent if the homeowners chose to sell their property. These contracts were primarily offered to financially struggling homeowners in need of quick funds.
The agreements stipulated that MV Realty would receive compensation if the company successfully sold the property, if the homeowner terminated the contract, or if ownership of the house underwent any change, such as through a deed transfer, foreclosure or upon the homeowner’s death.
EXTRA: Real estate influencers allegedly scammed investors out of millions
Whatever the outcome of MV Realty’s legal woes, it’s important to make sure that you’re doing your fiduciary duty and playing the role of protector for those you serve. That means staying up to date on how tech is being used to both commit and fight fraud, learning about how transaction flow should be improved and improving your internal processes using the things you learn from past scams.
Over 50% of transactions are at risk for fraud. Here’s how to fight back
According to new Inman contributor and attorney Renée Hunter, property fraud of all kinds is on the rise, with everyone from cybercriminals to family members getting into the act. Think the problem is too big? Hunter offers practical steps that can help stamp out fraudulent behavior before it occurs.
EXTRA: ‘Cash Flow King’ took millions in Ponzi scheme, according to SEC
Rapattoni hack illustrates the need for this 13-step contingency plan
Real estate agents and brokerages are frequent targets for cybercriminals because they sell high-value products and, as independent business owners who work from home or on the road, often lack the cybersecurity tools employed by larger companies. Broker Leslie Guiley looks at the recent Rapattoni cyberattack and creates a plan to ensure you’re protected.
EXTRA: MLS hacked? Here’s your 15-minute, stay-in-the-know plan
The dark side of ChatGPT, deepfakes and real estate
Former real estate agent and current security expert Tracey Hawkins looks at how artificial intelligence can be used for creating convincing disinformation, impersonations, and even fake properties and images. While real estate professionals are increasingly using AI for marketing and other aspects of running their businesses, it’s essential to be aware of the potential dangers posed by this technology.
EXTRA: Donald Trump found liable for fraud for inflating real estate holdings
Christy Murdock is a freelance writer, coach and consultant and the owner of Writing Real Estate. Connect with Writing Real Estate on Instagram and subscribe to the weekly roundup, The Ketchup, in either newsletter or podcast form.