Lisa Nutt, a seasoned professional with Coldwell Banker, is at the forefront of combating real estate fraud, leveraging her extensive background in various sectors, including economic development and higher education. Since transitioning to real estate in 2018, Lisa has become a pivotal figure in the Tucson community, dedicating her efforts to unraveling the complexities of deed fraud. Her proactive approach and collaboration with local stakeholders have positioned her as a go-to expert on real estate fraud prevention.
The Evolution of Real Estate Fraud in the Digital World
The digital age has brought about significant advancements in the real estate sector, streamlining processes and enhancing efficiencies. However, it has also given rise to sophisticated forms of fraud, particularly deed fraud. This malicious activity involves illegitimately recording property in someone else’s name, often leading to significant financial and legal repercussions for both real estate professionals and consumers. As technology continues to evolve, so do the methods employed by fraudsters, making it increasingly challenging to safeguard against such threats.
Best Practices for Fraud Prevention
To combat this growing concern, real estate professionals must adopt a vigilant and informed approach. Here are some best practices that Tucson realtors can implement to prevent fraud:
- Verify Identity Thoroughly: Ensure that all parties involved in a transaction are who they claim to be, using multiple forms of identification and cross-referencing information.
- Stay Informed on Latest Trends: Keep up-to-date with the latest fraud tactics and technological tools that can help detect fraudulent activities early.
- Utilize Fraud Prevention Services: Engage with services like the Fraud Notify system offered by the Pima County Recorder’s Office to receive alerts on any suspicious activities related to property deeds.
- Educate Clients: Inform your clients about the risks of deed fraud and encourage them to take proactive measures to protect their property.
- Collaborate with Trusted Partners: Work closely with title and escrow companies, legal advisors, and other stakeholders who are also committed to preventing real estate fraud.
Engage, Educate, and Empower: Your Path to Real Estate Excellence
For those seeking in-depth insights and guidance on navigating the complexities of real estate fraud prevention, Lisa Nutt stands as a beacon of expertise. Her extensive experience and proactive measures in combating deed fraud make her an invaluable resource. Realtors are encouraged to reach out to Lisa directly with any questions or for further information.
Additionally, real estate professionals can enhance their knowledge and stay ahead of industry trends by engaging with our “Insights for Agents” series. These videos provide valuable perspectives and actionable advice from industry leaders like Lisa Nutt, offering a deep dive into the nuances of real estate and helping professionals navigate the challenges of the market effectively.
Our “Your Mortgage FAQs” section is another critical resource for realtors, offering essential information to guide clients through the financing aspects of real estate transactions. Understanding these key details can empower realtors to provide better service and support to their clients.
For any questions or further information, realtors should not hesitate to reach out. Our combined expertise and willingness to assist provides an excellent support system for real estate professionals looking to expand their knowledge and skills.
Transcript (Unedited)
Tom Heath
Well, we are here with Lisa Nutt of Coldwell Banker, and she wears many hats in this community. I do. I get to. You get to. Yes.
Lisa Nutt
Yes.
Tom Heath
In today’s topic, I want to get into a very specific type of concern for both real estate agents and consumers, but first of all, let’s find out a little bit about you. You’ve been in real estate for four or five weeks now?
Lisa Nutt
Slightly longer. Okay. Since 2018. team.
Tom Heath
Okay. What did you do before real estate?
Lisa Nutt
Oh, goodness. This is the fifth iteration of my life, at least, Tom. I left a career in higher education before becoming a realtor. I have had an economic development career. I’ve had an international relations career, and this is the third time I’m in business for myself. I’m in. I’ve owned a restaurant, and then I owned
Tom Heath
–
Lisa Nutt
Where was your restaurant? Was it in Tucson? It was. It was over in the Butterfield Business Center, which still exists. Yeah, on the west side. On the south side towards the airport. Yeah, actually, southeast side, yeah, yeah. Across the street from what was the Holodome. Oh, yeah. And is now the Center for Opportunity, right? So we were a restaurant and deli in that business center that really serviced the businesses in that commercial property.
Tom Heath
All right. And now into the real estate world. And now hearing all, and I knew you had a varied background, but I didn’t know about all of those details. And now it starts to make a little more sense as to why you can’t sit still as a real estate agent and get yourself involved with all kinds of different things.
Lisa Nutt
All the good trouble that I can create, right?
Tom Heath
Well, I know you’ve chaired and been on many different committees, and the one I want to focus on today is the Homeland Property Advocates at the Tucson Association of Realtors, and you’ve taken on a few specific tasks for them in all of those HOAs. Everything could be its own show, and we should probably have you back for that, but really wanted to discuss this concept of deed fraud. It’s something that I’d heard little about and now hearing a lot more about. And you’ve been digging into this.
Lisa Nutt
I have. I started tracking a pretty high -profile case out of the Phoenix area several years ago because it was a high -profile case, both at a state level and a national level, and just paying attention to it as a realtor, right? As an agent, and in this case, it is a fellow agent who was a victim of deed fraud through her parents’ property. She was the executor of their property.
Tom Heath
Can you give us just like the overview of what deed fraud looks like? Because it’s hard for me to grasp that. I haven’t been in this business for a while.
Lisa Nutt
Yeah, so it can manifest in a variety of ways. essentially, the whole point of the crime of deed fraud is to record a property in the bad guys or gals name in order for them to either leverage that property in some way or gain the proceeds from the sale of that property. So depending, they could, for example, also commit identity theft or identity fraud in perpetuating this crime okay so I I became aware of the issue in general right through that one article I was reading one night much like I do every single night of my life and thought oh goodness I wonder how this is gonna play out and then became aware of more and more cases and thought I’m a realtor. I have relationships with people. We could probably, you know, bring together a group and discuss what that means for us here in Pima County. And so that’s really, that’s really how it began. And we were able to bring together Pima County stakeholders, including the Pima County Assessor’s Office, Pima County Attorney’s Office, Pima County
Lisa Nutt
Recorder, the Association, the State Association, the Pima County Administrator, Title and Escrow. So various expertise really in order to bring to bear the insight because as you and I know our industry is very interdisciplinary, very multifaceted. There are different responsibilities by different individuals or organizations and so I you know dare say that it was the first time that multiple perspectives were in the same room discussing the same issue. And with that many people that I assume the issue is solved case closed. I can move on to the next one oh if only right? If, just like I say, if I had a magic wand, right? No, not quite, but what has come of it are changes in the practices that different organizations will be either, you know, completing or have since changed, both in Title and Escrow, for example. Our Title and Escrow companies here locally are looking at implementing some changes that they can all use. My intention was to identify the gaps. Where are all these gaps? Because
Lisa Nutt
these bad guys are exploiting those gaps in our ecosystem. And so what are those gaps? How do I identify them? And then what do we do about them? The thing about fraud is that it is fluid. Right. And just when we think we have instituted, you know, a mechanism or something new to either manage, mitigate, or eliminate that, don’t they just come up with another way?” And so just as technology has facilitated our work, it has also complicated our work and made it more easy in some cases for them to perpetuate their crimes. So for example, they will create fake identification. Right. And those identifications can actually pass typical tests for identity. You know that as a lender, right?
Tom Heath
We’ve gone through some issues with this as well, where the level of skill now with artificial intelligence and other technical facets are just really hard to identify.
Lisa Nutt
Although it still is the human eye, right? And our sense of it not looking right, somehow, or it not sounding right, or feeling right, that AI and computers can’t do, right? So there are right yet, as sentient as they might get, I hope that’s the one thing that distinguishes us.
Tom Heath
I know you’ve done a lot of work and I don’t want to get too far into this video with it, but just want to make sure people are aware that you’ve been working with the state. There’s actually legislation that’s been proposed and discussed probably won’t happen this year, but at least it’s on the table.
Lisa Nutt
Right. And still there’s a lot we can do at a county wide level, right? So in Pima County, we have about 435 ,000 properties, both residential and commercial. And as agents, there are red flags that we can pay attention to. Most obviously is when someone contacts us as a potential seller. And if they say things like they’re in a hurry to sell, they’re willing to sell below market, it. They are unwilling to meet in person, or they are unwilling to have a FaceTime or a Zoom. In other words, where you don’t get eyeballs on them and can’t substantiate that they’re a person, number one. And are they the person they purport to be? So if agents get those types of inquiries, That’s the first set of, hmm, you may want to make sure and do your due diligence just on taking them on as a client. The other aspect has to do with title and escrow. Our colleagues in those fields are the ones who are really taking the brunt of that investigative aspect of our work and really drilling down on the life history
Lisa Nutt
of that property. and it’s in that analysis and in that review that at times the mistakes the bad guys are making come to light. So things like a mismatch in Tony Smith presented an ID as an older male. Well they found a deed where Tony Smith was a younger female. And so then it becomes a hmm, right?
Tom Heath
The names match, but they didn’t know.
Lisa Nutt
Correct, right? The other demographic information is not a match. Title and escrow are sometimes sending letters to property owners to verify, you know, congratulations on the potential sale of your property and asking them to verify that yes, in fact, they are selling their property and to, you know, substantiate that in writing. So, the practices that we may have been using for years may no longer be enough to protect ourselves and to protect our clients from, again, the whole goal of this crime is to take ownership of that property and then do with it what they will. On a national level, we’re already at about a $400 million loss and it is happening across the country.
Tom Heath
Well, if someone’s going through this transaction, there’s some protections built in with a real estate agent who’s paying attention, with a Title IX officer paying attention, but as a consumer, I know there’s gotta be a way for me to do some things to just protect myself, even if I’m not going through this process.
Lisa Nutt
Right, we do now at a county level have something called an opt -in notification system through the Pima County Recorder’s Office. So, if you go to the Pima County Recorder’s office, you will first need to create an account with the Pima County Recorder, and then enroll in the notification system. It is now called Fraud Notify. It was called Fraud Guard before, and now it’s called Fraud Notify.
Tom Heath
So, they’re not guarding you from fraud. They’re just letting you know. They’re just
Lisa Nutt
letting you know.
Tom Heath
Hey, you may have been victim of fraud.
Lisa Nutt
Which is the other aspect of it, right? Sadly, in many cases, people will find out after the fact. You and I know, as real estate professionals, that recordation is the last step in the life of a transaction, and we hand over keys. After that, from an information and data standpoint, that information then goes from the recorder to the assessor’s office, and the assessor’s database is then ultimately the keeper of that information. But once it’s recorded, it becomes very difficult to unwind a fraudulent transaction. So from a legal perspective or a statutory perspective, that’s why we need some new state laws and we need some existing state laws to change again because of how these bad guys are conducting these crimes. But in Pima County, you can go to the Pima County Recorder’s Office. I would just say Google fraud notify Pima County recorder to get quickly to the link It is a two -step process. You need to create an account with the recorders office and then enroll in the notification
Lisa Nutt
system Okay and being mindful that when you enroll in the notification system You are able to enroll as an individual with your name or names Because many times our name doesn’t just appear in one way, right?
Tom Heath
Right.
Lisa Nutt
Especially in legal documents.
Tom Heath
Right.
Lisa Nutt
Oftentimes, people will use their full first name, their middle name. Thomas J. Heath. Correct. Thomas Joseph Heath. T. J. Heath, right? All of the iterations that you can think of. And also, if you have entities, some people will own their property and have it in a trust. So you want to also make sure to register the trust’s name. Or if you own property through an LLC, you want to register the LLC’s name. The recorder will then let you know if a document has been presented with that name and what it was.
Tom Heath
And that’s still later in the process. So we’re looking at the processes that you’ve been talking about and I’ve heard you speak about at a committee level or identifying it earlier on. Correct. And there’s still some obviously work to do on that. Now, if you’re a consumer, well, if you’re anyone, the county has that option. if you’re a real estate professional, because this is being recorded in April of 24, this information will live in perpetuity, but on May 7th, 2024, there’s a panel?
Lisa Nutt
There is. We will be hosting a panel discussion at the Tucson Association of Realtors in the morning, 9 .30 to 11 .30, where we will have the various expertise discussing the issue and the mechanisms to either, you know, mitigate, manage, including the Pima County Assessors. She and her team will be there because they’re changing their practices. One thing that can be done, for example, and lenders and title and escrow may start doing this more readily, is to compare an an ID that is presented, a government -issued ID, against an existing database, like a motor vehicle database, and matching those two documents. They either do match or they don’t match. And details like the signature is exactly the same if they present more than one ID. or the picture has someone wearing the exact same clothes, or a typing error in any of the information. So again, we can do more to pay attention to those details in order to, again, protect the consumer and community,
Tom Heath
but also protect ourselves as professionals. So in our industry, we call those the red flag warnings. It doesn’t mean that there’s fraud, it doesn’t mean that there’s an issue, it just certainly means that this requires a little bit more scrutiny and take it to that next level, because our whole system is based upon a lot of people involved. And if we’re all doing our part, we should be able to help mitigate some of this.
Lisa Nutt
There could also be changes coming on notary services. That was gonna be the next question,
Tom Heath
is what that role they are.
Lisa Nutt
Right, because one of the things that we know is that these criminals will often have their own notaries. and even fraudulent notaries are being discovered. So, people who aren’t certified notaries are claiming to be and notarizing the documents that require the notarization. So, then that’s a whole other set of crimes. And also in the details, right? Whether there’s, for example, an expiration date or not on a notary stamp, or when that expiration date is or was. So, we could see some changes to how notaries are certified, what information they need to record and house, right, because they have their journal. The way the bad guy for the high -profile case in Phoenix was caught was because in California, since 96 or 97, on property -related transactions, a thumbprint has been required. Now, the thumbprint has to be compared against something, right? Not all of us have our fingerprints. Realtors do have to, right? In order to have our clearance cards, we have to provide our fingerprints.
Lisa Nutt
So, the bad guy’s thumbprint was provided and cross -checked, and that’s when they realized that the name associated to that biometric information was not the name provided on the transaction, and then opened up the investigation. So, sometimes the notaries are complicit in the crime, sometimes not, but it’s another area of review in terms of how do we certify notaries and what information are they gathering and what due diligence are they doing because what we are, what we understand is that notaries are just witnessing a signature and it’s being cross -checked against a government -issued ID. That’s kind of it and it’s provided in a journal. So, states are taking a look, including our state, at what do we require of notaries. The other aspect is related to mail fraud. So, I learned in doing my own research that mail fraud is only a federal crime. It is not a state crime. You and I know how do we usually send documents back and forth when we don’t have people in person? Besides electronic,
Lisa Nutt
we use private carriers, right? And it’s only a federal crime if you use the U .S. Postal Service. So it’s one of those things, one of those gaps, right, that I was like, really? It’s not a state crime and it’s only a crime if you use the U .S. Postal Service?
Tom Heath
Just to be clear, this is not a how -to video. We’re just identifying some potential issues. That will be rectified. I think this topic is ongoing and will have many nuances over the next several years because Because even once a larger fix is in place, the implementation of that will take some time.
Lisa Nutt
And the consistency of that implementation, right? Because again, they are opportunists and they take advantage of
Tom Heath
– The weakest link in the chain. Absolutely. And they will go to exploit it. So if you’re a consumer or really anyone, head over to the Pima County recorder site and get on the fraud notify. I’ve done that. It does take a little bit of time to set up, but it’s not overly cumbersome. Awesome. And then if you’re a real estate professional, I recommend you visit the association on May 7th. And also stay in tune with the Home and Property Advocates Committee as their reports have updates on this. And I would imagine as we get into the next legislative session, there’ll be some more conversations about what this looks like and making sure that it’s not an overreaction to a problem. Correct. Because you could certainly see it going too far, making it even more difficult to transfer property, which we don’t necessarily want. but we can find ways to do it in a safe manner and reduce the opportunities for these bad actors.
Lisa Nutt
Correct. It’s just really instituting the best practices that many of us know need to take the time to actually do. And certainly the communication amongst the half dozen of us or more that are involved in a transaction. And again, to an earlier point you made, hopefully a real estate agent is involved, right? hopefully there’s a realtor at the table who can help with some of that vetting and that due diligence. But we also know that there are transactions that are less than arm’s length that occur and that’s why it’s also important again for the community and the consumer to know and to pay attention to what documentation is out there and available with regards to their property and to make sure that again there is a way in Pima County to get notified if something is presented with your name or your entity’s name on it, and then for you to be able to understand whether that is for you, or if it’s a document that you presented. Because again, the recorder’s office responsibility is truly
Lisa Nutt
just to notify and to house documents that have been submitted for public consumption. It is meant to be a public database. And so so understanding the limitations and the realities of that and if people want to get a hold of you if they have questions
Tom Heath
On this or just other real estate related matters. What are some of your your contacted?
Lisa Nutt
Well, of course just you know, Google Lisa nut with two T’s, please. You will find me easily You can use my email Lisa nut at CB real t .com Or my personal email lot Lisa nut at gmail .com the two T’s two T’s, please
Tom Heath
Thanks for your time. Thanks for your efforts in this. You’re welcome. Thank you Tom
