When I am working with clients who are buying or selling their first home or perhaps even their second or third home I find most people have no clue what EMD is. How much EMD is necessary, what
Wire Fraud the New Pirates of the Caribbean
Dated: June 18 2019
Real Estate has plenty of loot to plunder and there are some new pirates on the seas. These pirates are much more sophisticated pirates then the pirates of the past.
Here’s how the pirates might try to raid your gold.
Step One- Insert a virus on your computer, your real estate agents computer or your title company’s computer.
Step Two- Access the infected computer’s email program and intervene in the email chain.
Step Thee- Insert new wiring instructions to account in the Caribbean and shiver me timbers, your money is gone and the pirates celebrate with rum…
I recently spoke with a broker who is dealing with this exact scenario. The pirates in this case managed to swindle the buyer out of over $300K without having to even board the ship… I don’t know about you but that is pretty scary! We all think things like this won’t happen to us but I assure you those pirates are close behind. As far as this broker and the investigators can tell the pirate sent them a fake file in the form of an online lead like Trulia or Zillow. Once the file was opened the by one of the agents their computer was compromised.
The pirate was then able to watch emails between their client and the title company. The title company sent of the final statement showing the all the fees and the final amount due to purchase the property. It was here that the pirate was able to intervene. They took the email from the title company, repackaged it with new wiring instructions to guide the money into their account and sent that to the buyer. The buyer unknowingly reviewed the fees and wired their money right into the hands of the greedy pirates. $300K+ gone just like that….
So how do we agents and our clients combat such situations? These criminals are smart and nearly impossible to catch. There are stories in the news daily about the government and large corporations being hacked and losing valuable data to these invisible pirates.
Here are a few ideas on how you can safeguard your hard earned funds.
1. Use checks to deposit or pick up funds from the title company. Don’t wire money!
2. Validate your wire instructions with the title company.
Really, the best way to protect yourself and your hard earned money is to simply walk into the Title Company and deposit the funds or take your funds in the form of a check from them directly. That way you cut out the possibility of anyone intervening and sending you or the title company faulty information regarding the routing number or bank account.
I know in some cases walking into the title company to personally deliver or receive funds can take time and may not always be the ideal way to handle your business. If you must wire those funds to escrow or have the proceeds wired to you I suggest you contact the escrow company directly. Make sure you don’t use the phone number provided in the email from the title company because that could also be fraudulent. Call your agent and get the title officers phone number or look them up via google. Unfortunately, when wiring there is no clear fix at this point. Technology and pirates are always changing and seem to be one step ahead of us all.
Justin Cooper is a 14-year Real Estate veteran based in the Greater Sacramento region. However, his career has taken him to numerous markets around the country. Justin prides himself on superior custo....