How Wire Fraud, Hacking, Phishing and Whaling Affects the Real Estate Industry
Real Estate Wire Transfer Fraud
We might expect the real estate industry to be exempt from wire transfer fraud and a myriad of other hacking schemes that put our personal information at risk, but it isn’t. Unfortunately, we have come to live with this reality in the 21st century. Yet, every time we encounter a potentially dangerous email or hear about it from a friend or colleague, our reactions are normal: shock and fear.
No one should be made to feel financially vulnerable to outside influences. These experiences are emotionally shattering. Some people may find themselves out of thousands, maybe millions of dollars; or worse, completely depleted with no real probability of recovering their money.
The more technology we have and the more technologically adept we become in the 21st century, the more widespread and successful fraudulent activity continues to be. The Internet is a great thing. It shrinks the world. It puts information at our fingertips, literally. The predictable downside to any good side of something beneficial is that someone, somewhere is plotting to use it in an illegal or criminal way to make themselves richer.
It’s safe to say that the majority of us have become wise to the email requests of some foreign prince or student or relative many times removed who is stranded in some foreign country and needs us to send ridiculous amounts of money A.S.A.P. to get them in or out of said country! Whether you are at the top of the corporate ladder or run a neighborhood diner, the threat is the same: to steal your personal information.
The Home Buying Experience
Buying a home should be, and still is, one of the happiest times in life. The advice here is simple: be aware, be smart, scrutinize everything! Hackers do just that. They make it their life’s work to study the email accounts of buyers, sellers and their agents — more recently in luxury markets — to learn the date of scheduled closings.
Phishers, in particular, attach themselves to the creation of fake accounts and identify with the mindsets of buyers/sellers. They look for signs of compliance in the way real account owners interact in real estate transactions. It’s normal for most people to follow instructions quickly and deliver what is requested, for fear of having bosses or authority figures think ill of them. No one, however, is going to fault you for being careful or for asking questions. The simple process of merely opening the email and/or an attachment has already given the hacker access, potentially, to everything you own.
For example, if amounts of money are requested in an email, with a tight, specific deadline, asking for bank account information, and the name and/or sending address seems unfamiliar, STOP immediately!
Be vigilant about the sender of messages, especially if they look or sound unfamiliar. If someone legitimate is trying to contact you, they will identify themselves clearly to you and/or follow it up another way; by phone, letter, etc.
A sure fire way to suspect/know that an email involving money requests or directions is fraudulent, is to pay close attention to the sender’s grammar, sentence structure, misspellings, and mis-use of social expressions.
Example: “Your to send”, instead of “you are to send”.
“10,000$US”, instead of “$10,000”.
“Your OK” instead of “transaction complete”, etc.
Also, if there is any kind of logo or official seal attached to the correspondence, examine it for authenticity and pay attention to dates of messages and the times they are sent and received.
If you question something you read or the tone of the message is threatening or different than others you’ve received, don’t immediately respond or even respond at all. Have someone else look at the message; call the parties you know and have been dealing with. Most of all, DO NOT PROVIDE INFORMATION!
– NEVER send financial information by email, text message or via social media.
– Check out the website information appearing in the email. Copy and paste the web address into your browser and see where it takes you. Fake websites can look real.
– “https”: LOOK FOR THE “S” IN “https”. The “s” stands for “secure”. You won’t find the “s” in the address of bogus sites, because they are NOT real. Big companies and financial institutions have secure sites. DO NOT RESPOND.
– Reputable businesses, in this case, real estate agents and their companies, follow a kind of written protocol, using the professional language of the industry. As such, they will never ask you to transfer money or provide private information in or by email. Such information is usually requested by your escrow office, so be sure your agent knows this.
Luxury Market Alert
This kind of illegal activity has stepped up in the luxury real estate market, with agents as primary targets. Lenders and title companies generally have stronger security measures on their email accounts. But, agents and their correspondence with clients and others who are part of transactions, are more frequently hacked. Hackers regularly infiltrate the closing process of the transaction and send “an alert” email message to the buyer and/or agent instructing them to wire the closing costs to an “updated” account.
And, they’re smart! They are not collecting actual money as it is being transferred, but using the email process to identify the agents, the brokers, clients and other involved sources and divert funds to the wrong, bogus location.
Once they’ve penetrated an email account, they are able to send false messages to the parties involved, making those messages appear to come from the owner of the hacked account. In most cases, hackers will provide detailed information in these emails concerning where to send closing monies or instructing an escrow officer where to wire funds.
As soon as the money is sent to the bogus account, the hackers withdraw it immediately. Everyone involved thinks all is proceeding smoothly. You’ve taken your time coming to the decision to buy your home. The process, however, includes many transactions and communications. Take some more time. Be painstakingly alert to email messages about your purchase. We want you to be safe, secure and solvent in your new dwelling.