While we all are concerned about cybercrime and identity theft, it appears taking someone’s money the old-fashioned way has reappeared in a short sale EMD scam. The alleged scam appears to follow the same basic format. An agent claims to have a listing for a short sale (or probate or other distressed) property, but the property cannot be shown. After acceptance of an offer, the buyer makes an initial deposit in the $5,000 to $10,000 range into the listing broker’s non-independent broker escrow. As with most short sale or probate properties, the process can take several months, and the buyer’s agent is assured that the listing agent is working towards lender approval – it is just taking more time. Then the communication slows down, the selling agent begins to get concerned and calls the listing broker’s escrow. There is no answer, no return call, no other number to contact, and the earnest money deposit is gone.
This scam is nearly the same as a series of scams that appeared in the Los Angeles area about two years ago. The Los Angeles County sheriff eventually arrested the wrongdoers but only after millions of dollars had been lost.