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MortgagePoint » Your Trusted Source for Mortgage Banking and Servicing News 36 January 2025 F E A T U R E S T O R Y UNDERSTANDING THE SURGE IN TITLE FRAUD—AND HOW TO PREVENT IT B y DA X J U N K E R T itle fraud, though not new, recently gained national atten- tion when a Missouri woman attempted to fraudulently auction Elvis Presley's Graceland estate. She falsely claimed the property was collateral for an unpaid loan, using fake loan documents and a fabricated fore- closure notice in a Memphis newspaper. The scheme unraveled when it was dis- covered the loan documents contained falsified notarizations, leading a judge to halt the sale. This incident raises an important question: if Graceland can be targeted, is any property truly safe? Likely not. Title fraud is becoming more widespread, with perpetrators growing increasingly bold. Fortunately, there are ways to detect deed fraud attempts early, but mortgage professionals need to be well-informed to protect themselves and their clients. How It Works P roperty transfer fraud, also known as deed fraud or title fraud, involves the illegal manipulation of property ownership documents to unlawfully transfer a property's title from the legit- imate owner to another party without the real owner's consent. It's perpetrated through various methods, including forging signatures on deed documents, creating fake deeds, or using stolen personal information to impersonate the actual property owner. In some cases, AI and other digi- tal tools have also been used to create convincing forgeries of documents or to automate the process of generating fake deeds and other legal documents. Addi- tionally, the widespread availability of an individual's personal information through online databases has made it easier for fraudsters to impersonate property own- ers or fabricate convincing histories. The targets of these crimes are often properties that are free of loans and owned by absentee owners or others who may not closely monitor their property records. Once they gain control of the title, fraudsters will try selling the property to unsuspecting buyers, secur- ing loans against it, or renting it out to someone. The legitimate owner is often completely unaware of the fraud until they face an eviction notice or discover liens taken against their properties, at which point they face a significant legal battle to reclaim their rights. There aren't precise statistics on how common title fraud is, but there are many signs it's growing. In 2024, the American Land Title Association (ALTA) high- lighted the persistent challenge of seller impersonation fraud (SIF) within the real estate industry. According to a survey of 783 title insurance entities nationwide conducted by ALTA and NDP Analytics, 28% of title insurance companies reported at least one SIF attempt in 2023, and 19% reported an attempt during the month of April 2024 alone. Fortunately, most SIF cases are identified and addressed before closing. But there have been cases that weren't caught. For example, in one recent inci- dent, a fraud ring used forged quitclaim D A X J U N K E R is a real estate attorney who started in the title industry in 1991 after graduating from high school in Tulsa, Oklahoma. Dax continued working in the title industry while he obtained his JD from the University of Oklahoma, School of Law. He went into private practice with the law firm of Gable & Gotwals where he focused on oil and gas litigation from 1999 to 2003. In 2003, Dax became President of Oklahoma OneStop, a title company and joint venture with LandAmerican OneStop. In 2004, Dax became a Member and the President of Community Closing Services, an affiliated business arrangement with a real estate brokerage and builder. In 2009, Dax formed Main Street Title Company, a joint venture with a large regional builder, which he owned and managed from 2009 to 2018. In 2013, Dax created Title Clearing & Escrow LLC (TC&E) a national title company. In 2019, he partnered with The Fay Group where he continues to serve as President of TC&E.