Alabama law lets officials void fraudulent property transfers

The Alabama Securities Commission may investigate reported property fraud and issue an order declaring a fraudulent transfer void. The process covers complaints alleging land fraud or a fraudulent transfer of real property. The commission must receive a complaint and investigate before finding that fraud or a crime involving true ownership caused the transfer. A party may appeal the order to circuit court, which reviews the case anew. A party has 30 days after the final order to appeal. If no timely appeal is filed, the complainant may ask the circuit court to enforce the order and clear the rightful owner's title.

Covered online real estate platforms must check identity and ownership records before publishing certain listings. Covered platforms are public websites whose main business is advertising property for sale or lease. Private sites, social media, news sites, broker-only listing services, and internal tools are excluded. This applies to listings submitted directly by an owner that were not first listed through a licensed broker, brokerage, or multiple listing service. A platform may use a third-party service to check identity or ownership. The platform must get the required documents before it publishes, hosts, advertises, or otherwise shares the listing publicly.

A covered online real estate platform must remove interior photos or videos from public view after an owner's request and ownership check. This applies to interior photos or videos of property that is not currently listed for sale and is publicly displayed by a covered platform. The owner must make a written request, and the platform must check the owner's identity and ownership through reasonable means. The platform may keep copies for records, legal compliance, fraud prevention, or internal business use, but may not keep displaying them publicly after a valid request. The platform must remove the images or videos within 30 days after verifying ownership.

Settlement agents must verify a seller's identity before closing certain property transfers. The identity check applies to settlement agents handling the specified Class III transfers. The criminal provisions apply to fraudulent residential property sales or leases. The requirement applies to Class III property that is vacant or not owner-occupied and has no security instrument. The act's criminal provisions cover fraudulent residential sales or leases made with intent to defraud by someone who knows they lack legal authority. An aggravated charge also requires transaction funds or an individual owner who is at least 70 years old. The act took effect October 1, 2026. The settlement agent must verify identity before closing a covered transfer.