Real Estate wire fraud is increasing at a drastic and alarming rate and can happen to anyone. It is something that all home buyers should be aware of and watch out for throughout your home buying experience. In 2018 alone, the FBI reports that over 11,000 people were victims of wire fraud in the real estate and rental sector alone with a whopping $150 million. This figure is a 17% increase from 2017 and continues to rise. We’ll discuss the ins and outs of real estate wire fraud and how you can prevent it from happening to you. First, let’s explain exactly what is wire fraud:
What is Wire Fraud in Real Estate?
Real estate wire fraud is most often found in an email. It is an elaborate scheme to dupe individuals making wire transfers during the home buying process into sending the money to the criminal’s account. Typically, the home buyer will receive an email seemingly from their realtor or title company involved in the transaction. The email can look very similar to an authentic email, right down to the fonts and headers. This fraudulent email will often include wire transfer information that must be done within a short amount of time, ask for verification of banking information, or ask for personal information. Of course, to avoid risking losing their dream home, the home buyer unknowingly transfers money right into the criminal’s account.
How Real Do These Fraudulent Emails Look?
These emails are incredibly convincing and the attackers are only getting better. Often their email addresses will include the names of the people that are directly involved in the real estate closing. They’ll have everything from the names of the closing officers, the purchase price of the house, and even photos of the property. Most of the time, the only thing that is off is an extra space or an additional character in an email address.
How Do Criminals Get The Information?
With so many people involved in a real estate transaction, from the mortgage loan officer to the closing agent, criminals have multiple opportunities to break in and gather the information they need. Most start by scouring the internet following the Multiple Listing Services (MLS), Zillow, and other real estate listing services for pending home sales. Next, they use public information about the parties involved easily found on websites and social media sites. Finally, they begin to bombard all parties with phishing emails, hoping one of them secures access to confidential information. If they are able to gain access, they'll utilize the information to build fraudulent emails to get home buyers to send their hard-earned money to the wrong account.
How to Prevent Real Estate Wire Fraud
The number one thing that you can do to protect yourself from wire fraud is to understand that by purchasing a home, you are already at risk. Knowing is half the battle here. Once you know that this threat is out there and prevalent, you are prepared to implement the following prevention strategies:
Verify everything: Using a phone number that you have saved in your phone (not one in the email) contact all involved parties to verify that this email is directly from them.
Be wary: Be suspicious of all emails involving a change of plans, asks for money, or is verifying personal information.
Forward all emails: Avoid replying to emails. Instead, forward the whole email to the email address you currently have on file. Generally, fraudulent email addresses are very similar to authentic email addresses. By forwarding the email to an existing email address, it is much easier to catch the criminal.
Confirm information: Ask the bank to verify all information and verify it with your information that you have to make sure everything matches. Always contact our office to verbally confirm the wire instructions before sending the funds.
Ask for verification: After sending a wire transfer, contact the recipient immediately to verify that they actually received the money. The sooner an error is detected, the better the chances of retrieving the money.
Ask Your Florida Title Company
If you’ve received a suspicious email or you’re worried you might be at risk, be sure to contact your Miami title company for help. At Flamingo Title Services, we’re here to support you. We want you to experience a seamless home buying experience, from start to finish. Contact us today at 305-722-0533. Always call your title company before transferring any money. Although we cannot offer you legal advice, we can explain our process and what to expect from us to have a successful home closing.