Wednesday, March 13, 2019

WIRE FRAUD what you need to know

It's a nightmare scenario for any homebuyer: the day before closing, a scammer manages to trick you into wiring your down payment to an offshore account. You lose your hard-earned money and you lose the house, and there's no way you can get either one back.

How criminals fool homebuyers

1. A person involved in a real estate transaction, such as a title company, real estate attorney or realtor, has his or her email account compromised by malicious software, known as malware, sent by a criminal over email.

2. Just as a closing date is coming near, the fraudster uses the compromised email account to send a legitimate-looking message to the buyer complete with company logos – which, coming directly from the realtor, title company or attorney's account, appears real. The email tells the buyer that there's been a change of plans, and he or she needs to wire the down payment just before the closing date, supposedly to a bank account belonging to the seller.

3. But the account actually belongs to the criminal, and is typically overseas, out of the reach of U.S. law enforcement.

4. In some cases criminals even follow up with phone calls to the victim buyers, purporting to be from a representative for the title company or seller's law office, and reassuring them the wire transfer request is real.

What you can do

According to the FBI, email compromise crimes, including similar attacks on businesses, have been spiking. Cybersecurity company eSentire reported that real estate was the second highest industry hit with malware events in the second quarter of 2018. Between 2017 and mid 2018, businesses and consumers reported a 136% increase in losses related to these crimes. The fraudulent transfers have been sent globally, to 115 countries, the FBI said. These scams are being reported nationwide.  Regardless of the size of the company, no title company, mortgage broker, bank or attorney firm is immune.

There are steps homebuyers should take to make sure they are protecting themselves from falling victim to fraudsters, according to Kalember and the FBI.

Be vigilant:
Homebuyers should first just be aware that they may be a targeted by scammers in this manner, and should be suspicious and act accordingly to verify any correspondence associated with their home purchase or sale.

Do not send or request wiring instructions via e-mail:
If an email is being hacked and watched by a scammer, this will tip them off to your upcoming transaction.

Voice verify before and after:

Lori Court, Manager Anvil Land Transfer Title Company says, "It might seem cumbersome in an already long homebuying process, but following up emails with a voice verification is a must. Do not trust any email alone containing wiring instructions - even if it looks authentic."  And this is important: do not call the number, or accept a call from a phone number within the email. You must make the call to a previously used phone number for your title company. After you send a wire, call your title company to validate the funds were received. Detecting that you sent money to the wrong account within 24 hours
gives you the best chance of recovering your money.

Agents at Beiler-Campbell Realtors & Appraisers are well educated on the schemes targeting the real estate industry. Their Agents are committed to educating their buyers and sellers to protect themselves. Click to view a wire fraud warning on their website.

Click to ask a Real Estate Professional a question

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