Caught in the Crosshairs?

Cash, LLCs, or Land Near a Base? You Might Just Be a Target

In today’s security-conscious environment, real estate deals aren’t just between buyers and sellers — they’re being watched, analyzed, and sometimes flagged by federal agencies. And while the average home transaction flies under the radar, certain combinations of factors can put your deal squarely in the government’s crosshairs.

This post outlines the most common red flags that trigger federal interest — not because you’ve done something wrong, but because your transaction fits a high-risk profile.

All-Cash Purchases Over Federal Thresholds

All-cash deals aren’t inherently suspicious — but they circumvent the checks that come with traditional financing. That’s why they’re monitored more closely, especially in certain cities.

Triggers Scrutiny When:

• Purchase occurs in a FinCEN Geographic Targeting Order (GTO) region (like Boston, Miami, NYC, etc.)
• Buyer uses an entity (LLC, trust, partnership) rather than a personal name
• No mortgage or lender involvement, making the source of funds opaque

Check if your city is on FinCEN’s GTO watchlist

Foreign Buyers Purchasing Near Sensitive Locations

If you’re selling land or property near a military base, seaport, or energy facility, and your buyer is a foreign national or foreign-controlled company, your deal may come under review.

Triggers Scrutiny When:

• Buyer is from a geopolitically sensitive country (e.g., China, Russia, Iran)
• Property is within 100 miles of a designated sensitive site
• Transaction lacks full ownership transparency

Learn how CFIUS flags foreign real estate transactions

Use of Shell Companies or Anonymous Trusts

The U.S. government is increasingly focused on beneficial ownership transparency — knowing who is actually behind the deal.

Triggers Scrutiny When:

• The entity used is registered in a secrecy jurisdiction (Delaware, Cayman Islands, etc.)
• There is no clear beneficial owner disclosed at closing
• Documents reference multiple layers of ownership

See how the Corporate Transparency Act impacts real estate deals

Unusual Transaction Patterns or Repeated Flipping

Agencies like the IRS and FBI monitor the real estate market for signs of fraudulent investment behavior or tax evasion schemes.

Triggers Scrutiny When:

• Property is bought and resold quickly at an inflated price
• There’s a series of transactions between related parties
• Funds move between multiple accounts or buyers during closing

FBI tips on recognizing property flipping fraud

Wire Transfers from High-Risk Countries or Banks

Closings often involve multiple wire transfers — but not all financial institutions are treated equally. Some are flagged for lax compliance standards or sanctions risks.

Triggers Scrutiny When:

• Funds are transferred from offshore accounts with unclear sourcing
• Transfers pass through non-U.S. banks flagged by the Treasury Department
• The transfer amount and origin don’t match the buyer’s stated income or citizenship

Check OFAC’s sanctions lists (used by Homeland Security and Treasury)

How to Avoid Red Flags — Without Wrecking Your Deal

You don’t need to avoid cash, trusts, or foreign buyers altogether — but you do need to approach them with transparency and legal oversight.

Here’s how to protect your closing:

• Use a qualified closing attorney who knows what will raise compliance concerns
• Disclose beneficial ownership if you’re buying through a business or trust
• Avoid unusual structuring (like passing ownership through a friend or nominee)
• Keep clean documentation for funds, identity, and intent