POTENTIAL FRAUD – PLEASE BE AWARE OF INTERNATIONAL INVESTOR WHO IS SUBMITTING ALL CASH OFFERS

Please be alert to real estate fraud. This is a true story.
Another MLS provider (Loopnet) sent a buyer a lead for a $2.2M listing since they had an office policy that prohibits dual-agency. The broker referred the lead to another qualified investment broker.  Although the deal had a shaky start, (the buyer was an international investor working on an oil rig and not able to chat via phone), both of the involved brokers were able to qualify the lead to the point they felt like he was a legitimate buyer.
Over the month, the buyer and seller negotiated first, a letter of intent, second, a formal purchase and sale agreement, finally, arrived on a price, terms, closing date, title company, inspectors, and Phase I.  During this process, the buyer was introduced to a well known, veteran real estate attorney who assisted in the negotiations. The buyer did provide proof of funds on a foreign bank, and although there was some concern about his ability to get those funds out of his country, he did draw on a Canadian account and send the entire purchase price to his attorney.
His attorney confirmed the bank account had sufficient funds to clear the check he had received, and based on that information, wired funds to the title company. The following day, the attorney’s bank put a hold on the buyer’s check as it had been marked as a fraudulent transfer, since the buyer was not a signer on that checking account.  The attorney verified with the account owner that they did not know the buyer.
Additionally, while all of this was happening, the buyer requested that his attorney wire some of those funds to the buyers wife who was buying items for the property.