Here are some ways to stay in the know to help protect you, your associates and your clients from this cyber scheme.
It’s a scenario that could chill even the most seasoned real estate agent: Your client is in the homestretch of the buying process when they receive an email instructing them to wire closing funds to a specified account.
At face value, this kind of communication doesn’t seem suspicious, except that the email didn’t come from you or a settlement service company. It originated from cybercriminals who have hacked an email address belonging to you or a partner in the buying process. These hackers have monitored communications and know when the closing on a home is scheduled to take place. They may have even mimicked your writing style in their communications to your client.
All of this effort serves one purpose — to get your client to send funds to an offshore account, leaving them without the money to complete their home purchase.
The Scope of the Problem
While email scams are nothing new, the targeting of the real estate industry is a more recent and disturbing trend in an age when many sensitive transactions occur via digital channels.
Reports by The Washington Post, The Chicago Tribune and New York Real Estate News all identify cases where buyers, believing they were in communication with authorized parties, wired large sums of closing funds to accounts linked to parties with criminal motives.
The email money wiring scam has even captured the attention of the Federal Trade Commission and the National Association of REALTORS®, who issued warnings to consumers in 2016.
Who is targeted?
In many cases, hackers target unsecured networks or personal email accounts that lack extra layers of security or encryption.
Since it’s not uncommon for real estate agents to conduct business on the go — sometimes using personal email addresses or networks in public places — they may be especially vulnerable to hackers involved in wire fraud and other scams.
What you can do
It’s impossible to know just how many individuals are involved in such schemes, but there are steps agents can take to reduce the risk for themselves and their clients.
One important recommendation is to try to reduce or eliminate the sharing of personal information, particularly financial data, via email. If possible, try to exchange this kind of sensitive material in person.
Another suggestion is to conduct business using secure networks whenever possible.
Finally, real estate professionals are advised to caution their clients against opening, clicking or responding to suspicious-sounding emails — particularly those involving requests to wire or transmit funds.