Land Sale Scams

Leon received a telephone call from Teddie, a representative of the Pleasant Springs Development. Teddie described the Pleasant Springs Development in glowing terms and talked about the potential for a huge increase in property values. Teddie went on and on about the once-in-a-lifetime opportunity she was offering Leon — a chance to buy a five-acre parcel of land on which to build a home for $25,000. Leon was reluctant to agree to buy a piece of property he had never seen before, but Teddie was so nice. She sounded like an honest sort. And, as he was nearing his retirement years, Leon was really interested in a huge increase in the value of any investment he made. So, Leon decided to go ahead with the purchase. Approximately one month later, Leon went to visit the property. He was shocked to find out that the piece of property he purchased was next to a county waste site. The property had to be worthless. Who would want to build a home anywhere near the county dump?

Dirt Pile Scams

A land sale scam, sometimes referred to as a dirt pile scam, refers to any transaction in which a seller of property convinces a buyer to buy property with a low value or no value for an excessive price. Very often, the sellers involved in such transactions solicit large numbers of potential buyers and succeed in selling numerous pieces of property before the scam is discovered. And, sadly, it is often the case that such unscrupulous individuals target the elderly or those on fixed incomes.

If you receive a call asking you to buy property you haven’t seen, be wary. If it sounds too good to be true, it probably is. If you receive such a solicitation and find that you have some interest in purchasing the property for sale, it is very important to make a thorough investigation of the company with which you are dealing. Is the company financially solvent? How long has it been in business? Have there been any consumer complaints or lawsuits filed against the company?

Furthermore, it is crucial that you determine the exact nature of the property for sale, as well as its value. Visit the property for sale before you enter into any agreement to make a purchase. Is the property desirable? Does the property conform to the description that was provided in the initial sales solicitation? Is the property consistent with the use you plan for it? If the property is undeveloped, what are the development plans? Who will pay for roads, etc.? A real estate agent may be able to assist you in determining the value of comparable properties. Moreover, the local tax assessor’s office should be able to provide information in this regard.

Additional information is available by contacting:

U.S. Department of Housing and Urban Development

451 7th Street, SW

Washington, DC 20410


To report suspected fraud or to make a complaint, you can contact the Federal Trade Commission (FTC). The contact information for the FTC is as follows:

Federal Trade Commission

Consumer Response Center

600 Pennsylvania Avenue, NW

Washington, DC 20580

1-877-FTC-HELP (1-877-382-4357)