TDCI, Real Estate Commission Urges Tennesseans to Beware of “Cloud Companies”Fraudulent Companies Take Advantage of Prospective Home Buyers
NASHVILLE – Buying a home should be an exciting and joyous time, but some real-estate scammers seize the opportunity to try and scam Tennesseans out of house and home. To raise awareness of the growing trend of “cloud company” real-estate scams, the Tennessee Department of Commerce and Insurance (TDCI) and the Tennessee Real Estate Commission are warning potential homebuyers of a new scam targeting real-estate seekers.
The scam involves fake “cloud-based companies”, which are online real-estate websites advertising available property. While the properties might be real, the companies are not. In actuality, scammers have created duplicates of legitimate websites and are advertising property they do not have permission to sell. Some unscrupulous individuals even steal licensees’ identities in order to portray themselves as a licensed agent, when in fact they are not. The scammers can go so far as to accept a down payment for the advertised property and then leave the consumer with nowhere to go and an empty bank account.
Another version of this scam includes a fraudulent cloud-based company offering to purchase property, resell timeshares, or offer renters services. These companies often ask for a fee that’s explained by them as an inspection fee, escrow fee, or commission before services are rendered.
“Saving money for a home can take years, but scammers can grab it all in just a few clicks of a mouse,” said TDCI Commissioner Julie Mix McPeak. “We urge consumers to always ask questions about the deals they see on the Internet. Be wary of paying fees for property you have not seen in person or before verifying that the agent you’ve contacted is legitimate.”
To avoid these scammers, TDCI’s Real Estate Commission shares the following tips:
- Check verify.tn.gov to ensure both the company and the individual agent are properly licensed with the Tennessee Real Estate Commission.
- Confirm the city of both the company and the agent at verify.tn.gov. If the locations do not match, call or email the Real Estate Commission at 615-741-2273 or email@example.com to verify what firm the agent is associated with.
- Proceed with caution if the company is asking for money up front. Never give money to someone you don’t know or have any information about other than how they portray themselves on the Internet.
- Be sure to confirm the company’s exact location before proceeding with business negotiations. Pay special attention to the suite number or floor they are located on. Many fraudulent companies list well-known business addresses, but are not actually associated with the building.
- If you are wary about the location listed, search for the address on the Internet. Look for a street view of the location to confirm that business name is on the sign or building address matches the one provided. If you’re still in doubt, visit the company.
If you have been the victim of a scam, visit tn.gov/commerce to file a complaint.