July 2, 2019
Wire Fraud: A Harsh Reality in the Title Business
Unfortunately, it’s a harsh reality in the title business. Some say technology provides scam artists with new tools. Meanwhile, wire fraud represents a real nightmare for homebuyers. Trickery hurts everyone involved.
A couple of years ago, wire fraud cases involving real estate transactions reached an all time high. Meanwhile, the FBI’s 2018 Internet Crime Report provides some specific examples concerning fraudulent wire transfers:
- In New York, homebuyers thought they received an email from their closing agent. It turns out that someone infiltrated the closing agent’s email. Unfortunately, this wasn’t discovered until after the homebuyer initiated a wire transfer of $50K to a fraudulent bank account.
- A spoofed email led a Colorado individual to wire over $56K for closing on his home. Once again, the instructions were fake. The bank caught on and froze the funds before the transfer went through.
- In New Jersey, a scam artist instructed a municipality to transfer over $1M to a fraudulent account. The money was ultimately recovered with the help of authorities.
These are just some examples of times the federal government became involved in saving money improperly transferred for real estate transactions. The instructions often look real. Meanwhile, you should know some of the background on how this happens in the first place.
Origination of Wire Fraud Instructions
According to authorities, sometimes wire fraud starts with title agencies. Are you familiar with the term phishing? Perhaps it’s something you’ve encountered with your personal email account.
Despite its best efforts, a company’s email may be overtaken by phishing scammers. You may think you are receiving instructions from your title company, attorney, or financial institution. Unfortunately, the directives come from a duped email address. And, yes, the money you send goes to the scammer’s account.
In some cases, the crooks aren’t so sophisticated. Before you wire money over to anyone, you should pick up the phone if you are concerned. For example, you may notice that the email address seems slightly off. Don’t be afraid to question it.
Wire fraud instructions sometimes come by phone. However, you should question any calls that you receive. And, don’t rely on your phone’s caller id for authenticity. Thieves can spoof phone numbers as well.
Homebuyers have enough to worry about when it comes to making what are likely the most expensive purchases of their lifetimes. Suspicions of wire fraud transfers call for experienced legal advice.