In the journey towards homeownership, the path has always been fraught with obstacles. However, due to the development of artificial intelligence (AI), a classic real estate scam – fund delivery fraud – is emerging in a new way.
The advancement in highly realistic digital mimicry technology (such as deepfake audio and documents) is forcing professionals in the real estate, property rights, and mortgage fields to rethink how to verify the identities of all parties involved in high-risk transactions.
According to the 2025 Internet Crime Report released by the Federal Bureau of Investigation (FBI), Americans lost over $20.8 billion last year due to cybercrimes. Losses from real estate fraud exceeded $275 million, higher than the approximately $173 million in 2024.
The FBI received over 22,000 fraud complaints related to artificial intelligence, with associated losses exceeding $893 million.
Michael Kelczewski, a real estate broker and mortgage originator at MAK Realty, revealed to the Epoch Times, “I have experienced an attempt to commit fraud through listing properties for sale, where someone claimed to be the legal owner of the property.”
Kelczewski recalled that initially, the provided identification and legal documents seemed very credible, but it was later discovered that these documents were generated by artificial intelligence. During the communication process, the fraudster also used AI technology to conceal their true identity.
“As the transaction progressed, inconsistencies began to emerge, and we raised the verification level, no longer relying solely on surface information. Ultimately, we determined that the listing was fraudulent, and law enforcement was brought in to investigate,” Kelczewski said.
“These scams are no longer necessarily as obvious or crude as they used to be. Some can present a set of quite believable identification, documents, and communication records.”
The American Land Title Association (ALTA), headquartered in Washington D.C., stated on its website that real estate fraud is “no longer limited to wire transfer scams or last-minute changes to payment instructions,” but “increasingly penetrating legitimate transactions, with individuals impersonating real buyers, sellers, and property owners.”
Jeremy Olsher, a real estate broker at Mizner Residential Group, expressed concern that AI technology is diminishing traditional identity verification methods.
“Hearing a familiar voice on the phone or seeing someone’s face in a video is no longer a guarantee that we can trust our own ears and eyes,” he described to the Epoch Times.
Olsher pointed out that the tools required to create realistic synthetic content have become “cheaper and easier to obtain.”
“The most dangerous situation is receiving requests for wire transfers or changes to payment instructions. Just receiving an email, text, or phone call is not sufficient to prove that the new payment instructions are legitimate,” he said.
Olsher emphasized that when payment details suddenly change, it is a signal to pause and verify before proceeding.
“At that point, it’s necessary to verify the payment details through trusted contacts using independently obtained information,” he said.
Colby Hager, a real estate broker and owner of Commission Cash Back, identified a specific moment in the real estate transaction process as a prime opportunity for AI fraud.
“The most vulnerable period is between signing the contract and having the funds in place, not at the actual property closing. Because during that time payments instructions are being passed between parties via email, unlike at the completion of the transaction when everyone is in the same room,” Hager explained to the Epoch Times.
In other words, he believes the entire transfer process has entered a dilemma.
“All the verification methods we use are based on the assumption that the channel itself is trustworthy. For example, dialing the phone number provided in an email, conducting video calls for confirmation, or comparing identification documents. If someone can forge a voice or face, then making a phone call for verification is like letting the fraudster confirm their identity,” Hager said.
The network security and real estate anti-fraud company “CertifID,” based in Austin, Texas, noted in its 2026 “State of Wire Fraud” report that 22% of American homebuyers received fraudulent information. The highest rate of suspicious real estate information occurred in the western United States, accounting for 26%. Southern states ranked second, with nearly 24% of consumers reporting receiving suspicious information.
Last year, Nevada and Florida were the top two states at the highest risk of real estate wire fraud.
Kelczewski stated that technologically savvy criminals primarily target vacant properties and investment real estate.
Some lawyers indicated that pursuing financial compensation in such cases can be extremely challenging.
“I have provided legal advice on several real estate wire fraud cases. At that time, the fraudulent instructions seemed to come from the title company, and even a follow-up phone call was made, with a voice the buyer recognized. Within a few hours, the funds disappeared,” Braden Perry, a partner at Kennyhertz Perry LLC, told the Epoch Times.
Perry mentioned that in such cases, the longer the funds stay in a “mule account,” the more difficult it is to retrieve them. A “mule account” refers to a bank account used by criminals to receive, hold, and transfer illicit funds disguised as legitimate real estate transaction funds.
“I am seeing multi-layer impersonations currently: forged emails along with cloned voices for confirmation. This combination precisely bypasses the security measures people are taught to use,” Perry said.
Perry stated that artificial intelligence has industrialized the means of past manual scams. However, he pointed out that while wire fraud in real estate closing processes has existed for years, the “red flags” that could once help detect the scams, such as grammatical errors and strange wording, are no longer present.
“Buyers wire six-figure sums as instructed, and the person issuing the instructions appears and sounds like someone they trust,” he said.
Perry believes that any last-minute changes in wire transfer instructions should be considered fraudulent until proven otherwise. “Legitimate title companies rarely change instructions at the last minute,” he said.
With the surge in AI-related fraud cases, part of the reason is the increasing popularity of tools used to carry out convincing scams, as well as the lack of technological means to prevent such fraud.
DuckDuckGoose AI, a deepfake detection and defense company, claims that generating a voice that matches a selected target by 85% takes only three seconds, and with just a photo, you can use basic open-source tools to do real-time face swapping.
In 2018, successful implementation of AI deepfake fraud required expertise in machine learning and programming. But now, with just a browser application, criminals can generate convincingly forged documents in less than an hour.
Perry stated that to detect fraudulent financial theft before experiencing losses, the key is to take the time for additional verification.
“Fraud succeeds because the home closing process is stressful and rushed. A five-minute call can save your life savings,” he said.
Deloitte, one of the world’s largest accounting firms, estimated that by 2027, AI-induced fraud could cause losses exceeding $40 billion in the United States.
Kelczewski expressed his concern that relative to the cost for fraudsters to launch attacks, real estate transaction amounts are very high.
“Even though most fraud attempts fail, a single successful fraudulent transaction settlement or intercepted wire transfer can yield substantial returns for the attacker,” he said. “This financial temptation, coupled with the increasing accessibility of AI tools, makes strengthening verification processes in the industry increasingly vital.”