23 Dec 4 Most Common Real Estate Scams in Miami

4 Most Common Real Estate Scams in Miami

Scam 1: Fake Rentals: Fake rental frauds take place when scammers pose as landlords or property managers and trick renters into paying a deposit or rent for a property that doesn’t exist, or that they have no legal right to rent.

South Florida residents are falling victim to fake rental listings on social media platforms like Facebook Marketplace, where scammers offer seemingly irresistible deals, such as a 3-bedroom, 2-bathroom house in Miami Beach for $1,200 a month. One victim discovered the scam when a legitimate real estate broker, Ana Lorenzo, found her own property listing being used fraudulently. NBCMiami covered Lorenzo’s story and the broader issue of deceptive rental listings, revealing how scammers exploit desperate individuals seeking affordable housing.

Home rental scams, similar to the one experienced by realtor Jonathan Daugherty in Jacksonville, are on the rise again. Scammers copy legitimate listings, like the Murray Hill property Daugherty was trying to rent, and post fake ads on platforms such as Craigslist or Facebook. This deceptive tactic tricks unsuspecting renters into paying application fees and deposits to the fraudsters, as highlighted in this recent case. Despite Daugherty’s efforts to warn potential victims and law enforcement’s limited ability to track down the culprits, these scams persist, affecting individuals across Florida, as reported by the Better Business Bureau.

How to Spot a Rental Scam: Quick Tips

Look out for signs like reluctance to meet, immediate move-in requests, and premature payments. Vet listings using these tips, meet landlords in person, and visit the property before committing. If scammed, report to local authorities, the listing website, the FTC, and file a complaint with the IC3.

Scam 2: Wire Fraud: This fraud occurs when scammers impersonate real estate professionals or hack into their email accounts to trick homebuyers, sellers, or agents into wiring funds to fraudulent bank accounts.

How to Beware of Mortgage Wire Fraud During Closing

A new breed of scammers is taking advantage of homeowners during the stressful closing period, using tactics like phishing. In this article, we cover information about mortgage closing scams, how scammers exploit homeowners, and ways to protect your closing funds. Stay vigilant to prevent falling victim to scams, which have seen a 1,100% rise between 2015 and 2017, according to data from the Federal Trade Commission.

Scam 3: Home Improvement Scams: Home improvement scams can involve contractors who charge exorbitant prices for shoddy work, or those who take a deposit and never start the work. They can also include fake repairman who offer to fix a nonexistent problem.

In another instance of deceptive practices, a pool builder, James Staten, faced 35 felony charges for allegedly embezzling $1.5 million from customers in Florida. The owner of Olympus Pools in Tampa engaged in an organized scheme, leaving 140 victims with incomplete projects. Staten’s fraudulent activities, including misusing construction funds and committing contractor fraud, funded a lavish lifestyle that involved extravagant expenses, such as $53,000 on Super Bowl tickets. His scam was exposed when customers, facing unfulfilled promises, sought restitution, leading to the shutdown of Olympus Pools and a lifetime ban on Staten operating any pool business in Florida. This case echoes the Home Improvement Scams, revealing the dire consequences of dishonest practices in the construction industry.

In the challenging landscape of Florida’s real estate and construction, homeowners are increasingly falling victim to contractor fraud, as exemplified by the recent scams involving Miami real estate developer Doug Cox and fraudulent pool contractor Brian Washburn. These cases underscore the urgent need for Senate Bill 414, which aims to address the inadequacies of the current Homeowners Construction Recovery Fund (HCRF) caps, ensuring a more robust financial safety net for homeowners facing the risk of fraud. Read more about these scams and the proposed solution.

Scam 4: Foreclosure Rescue Scams: Foreclosure rescue scams occur when a person or company preys on homeowners facing foreclosure, promising to help them keep their homes but instead takes their money and leaves them worse off.

In a similar vein of financial deceit, the owner of Olympus Pools in Tampa faces 35 felony charges, including grand theft and organized scheme to defraud, for allegedly scamming as many as 140 customers out of $1.5 million by promising pool constructions that were never completed. This case mirrors the insidious tactics of foreclosure rescue scams, exploiting unsuspecting victims through false promises and financial misappropriation.

In a disturbing trend of mortgage fraud, unsuspecting homeowners face the threat of foreclosure “rescue” scams, where deceitful entities promise assistance in saving homes but instead aim to steal equity or money. Various scams include false foreclosure prevention specialists, phantom help charging exorbitant fees, lease/buy back deception, false bailouts, and bait-and-switch tactics. To protect yourself, avoid upfront fees and promises of home salvation, and report suspicious activities to the Attorney General’s Hotline at 1-866-966-7226. For more information on these scams, read this comprehensive guide on foreclosure rescue fraud.

How to Spot Them and Protect Yourself:

• Work with licensed professionals: Verify that real estate agents, brokers, and any other professionals involved are licensed and in good standing.
• Avoid upfront payments: Avoid paying large sums of money upfront or giving personal information before verifying the legitimacy of the person or company involved.
• Watch out for high-pressure tactics: Beware of high-pressure tactics that may be used to rush you into making a decision.
• Verify ownership: Verify that the person selling or renting the property actually owns it or has the authority to sell or rent it.
• Report suspicious activity: If you suspect fraudulent activity, report it to the appropriate authorities, such as the Federal Trade Commission or the local police department.