NASHVILLE, Tenn. (WKRN) — Tennessee lawmakers could consider passing protections against real estate fraud after a state study revealed the issue is prevalent and growing in the Volunteer State.

Last year, legislators passed a bill requiring the Tennessee Advisory Commission on Intergovernmental Relations (TACIR) to study real estate fraud in the state and make legislative suggestions to address the issue.

According to TACIR's draft report, 185 dwellings in 50 Tennessee counties were stolen from 2019 to 2024, and reports of identity fraud for loans and leases increased from around 2,200 in 2022 to more than 2,800 last year.

Angie Lawless, owner and attorney at Wagon Wheel Title and Escrow, told News 2 her company deals with the issue every day.

“Every single time we look at a file, that is the number one thing we are most fearful of, and we are confronting suspicious incidents daily," Lawless said. “It used to be that the single biggest thing we faced was just clearing title insurance, making sure we gave you a clear title to the property based off of valid things. Now, what we’re facing is, 'Are we giving you a title to a property that you own nothing in?'”

From wire fraud to fake quitclaim deeds, the most common tactics used by criminals to commit real estate fraud are forgery and the use of fake IDs, according to the state. Lawless says the scams have become more convincing.

“Because of the internet, because of AI, it’s no longer some prince in a foreign country trying to steal your money with misspelled words, and the currency doesn’t look correct. It’s very, very good and very difficult to tell," Lawless said.

Tennessee is one of 24 states that currently don't require in-person training or an exam to become an in-person notary. TACIR suggested to lawmakers that change. Researchers said legislators should require notaries to take a course on notary laws, ways to prevent and recognize real estate fraud, and other topics.

In addition, TACIR said lawmakers could give registers of deeds the power to verify whether a notary's signature on a document is legitimate if something seems suspicious.

“If something looks fishy about a notarization of a stamp or whatever, there is at least an ability to potentially have that reviewed and find out if that notary actually did notarize that," Bob Moreo, TACIR's research manager, said.

However, Lawless believes that while the suggestions are a start, more needs to be done to address and prevent the problem.

“I think that we are going to have to be a lot more diligent at all steps in the process and there are going to have to be more proactive solutions, in my opinion, than just asking our register of deeds to possibly pick up a discrepancy because they’re far removed," Lawless said. "You need to get the on-the-ground people identifying that.”

Lawless's title and escrow company takes multiple precautions, including using secure portals, verifying IDs, and checking tax records to prevent fraud.

Lawless said property owners should find a trusted party, like an attorney and/or reputable title company, before making any real estate transactions. In addition, Davidson County property owners can sign up to receive alerts every time a document related to their property is filed, which can be done by clicking here.

To view TACIR's full draft report, click here.

News Source : https://www.wkrn.com/news/tennessee-news/tn-real-estate-fraud-growing-problem/