Don’t Get Ripped Off!
Posted September 2, 2018 in Real Estate Trends
Imagine sending off $200,000 to buy a house, only to find that you sent it to a scammer located on the other side of the world! Wire fraud in real estate is the fastest growing computer crime in the United States. According to the FBI, wire fraud in real estate increased over 1,100% over the last 3 years. Losses have increased over 2,500%! Victims have reported losing as much as $1.5 million in a single mistaken wire. Ouch!
What’s wire fraud? It’s when a party sending funds to another party is tricked into sending the money to the thief’s bank account instead of the intended party (usually the title company doing the escrow closing of the transaction).
Real estate transactions have become a target for three reasons:
- That’s where the money is. A thief can grab $735 in an average robbery, $7,000 in an average bank robbery, and $137,000 in an average wire fraud.
- Real estate transactions have multiple parties communicating by email: Buyers, Sellers, Realtors, lender, title company, and others.
- All of the information needed by the thief is online: personal information about the parties, email addresses, etc.
How do you know if the emailed wire instructions are legitimate or fake? Call the title company (using the phone number you get from their website or from “known” correspondence—not the same email as the wire instructions), and verify with the title company that the wire instructions are real and that the amount of money is correct and that it is time to wire those funds.
You can also pay those funds by paper check, but make sure you get that check to the title company at least one day prior to your anticipated closing.
Make sure that the professionals you are dealing with have the highest level of security on their computer systems, preventing someone from intercepting an email that tips off a thief that a real estate purchase is in the works or about to close—that’s when the thief, lying in wait, will pose as the person requesting the wire and say, “We are ready to close. Please wire $100,000 to my account.” They don’t need the exact or correct amount, as the thief could simply choose a random dollar amount to demand. Remember, even though we have the highest security available and send the wire instructions only by encrypted email, if the other party’s system is not secure, a thief can hack into their email and find out that they have been emailing with Realtors or the title company, tipping off the thief that a closing is approaching.
If you have any questions about wire fraud, title insurance, escrow or real estate transactions generally, feel free to give me a call. We’d love to be a part of your successful transaction, and the professional title and escrow people of Clark County Title are happy to assist you!
Clark County Title
1400 Washington St, Ste. 100
3200 SE 164th Avenue, Ste. 219
Vancouver, WA 98683