Bulletin: SLS2024017

Dear Associates:

Schemes in which someone pretends to be the seller of real property - seller impersonation fraud - continue to be a significant source of claims.

Seller impersonation fraud may involve any type of real property (residential or commercial, occupied or unoccupied), but it is more likely to occur where the property is undeveloped (vacant land) residential property and unencumbered.

We have previously issued bulletins advising of red flags relating to seller impersonation fraud and providing guidance for reducing such fraud. Those bulletins are linked below. Please continue to be alert to the possibility of seller impersonation fraud in all transactions.

Company Policy Regarding Insuring Undeveloped (Vacant Land) Residential Property

Effective immediately, as a condition for insuring title in any transaction involving the sale of undeveloped (vacant land) residential property, the following additional requirement applies, unless otherwise approved by a Stewart Title Guaranty Company underwriter:

Confirmation letter: Unless you have personal, prior knowledge of the identity of the seller, all issuing offices must send a letter to the seller requesting confirmation that the transaction is legitimate. A sample form is available here. You may tailor it to your specifications, or use your own form.  

This letter must be sent to the address shown on the records in the tax assessor’s office, not the address shown on the contract. We recommend sending this letter as early as possible. 

You may not close a transaction, issue a policy, or disburse funds for a transaction involving the sale of undeveloped (vacant land) residential property unless and until you have received a communication from the addressee confirming receipt of the confirmation letter and the legitimacy of the transaction.

All commitments for undeveloped (vacant land) residential property should contain a requirement that they are subject to satisfactory verification of the identity of the seller. The following is suggested: “The Company requires satisfactory verification of the identity of the seller."

The foregoing applies to all issuing offices involved in an undeveloped (vacant land) residential property transaction, including where the closing is split between buyer and seller.

If you are unable to comply with the above requirements, please contact a Stewart Title Guaranty Company underwriter.

If you are aware that a developed residential property is not occupied by the seller (e.g., tenanted, vacation home, vacant house, etc.), the confirmation letter is recommended.

If you have any questions relating to this or other bulletins, please contact a Stewart Title Guaranty Company underwriter.

For on-line viewing of this and other bulletins, please log onto www.vuwriter.com.