Technology has completely transformed the way we live, making everything from grocery shopping to planning trips to buying homes faster and more convenient. But unfortunately, the way we conduct our lives online has also opened up a multitude of new opportunities for scammers and cyber criminals.
Cyber crime rates are continually climbing. In fact, a public service announcement from the FBI reported a 136% increase in global financial losses between December 2016 and May 2018 due to business email accounts being compromised. The majority of these losses were tied to sophisticated scams that directly targeted individuals and businesses conducting wire transfer payments. Additionally, the 2018 AFP Payments Fraud Survey (underwritten by J.P. Morgan) showed that payments fraud hit a new high in 2017 with 78% of all organizations being hit by payments fraud during that year. Wire fraud accounted for 48% of those attacks.
Unfortunately, the real estate industry is far from immune to these criminals’ efforts. Scams targeted at the real estate sector rose 1,100 percent from 2015 to 2017, resulting in a loss of over $1.6 billion in the U.S. alone according to a report from Realtor Magazine. They also shared data from cybersecurity company eSentire stating real estate was the second highest industry hit with malware events in during the second quarter of 2018. As leaders in real estate title and closing services we know how devastating these attacks can be, which is why we make it a top priority to help keep our clients protected.
How Does Wire Fraud Work?
When it comes to real estate-related wire fraud, thieves typically target home buyers in the final stages of their transactions. Hackers gain access to the email accounts of key personnel – whether it be attorneys, mortgage lenders, title companies, buyers, sellers or real estate agents – and monitor their messages for details of the deal as it unfolds. The criminals then create a fake email address that mimics the seller, seller’s agent, a title company, an attorney or other stakeholder in the transaction and sends a request to wire the closing money to a specific account. By copying logos, email signatures and using language that sounds legitimate to the buyers, they are able to fool their victims.
The victim, assuming that the email is a legitimate request and a logical next step in their deal, complies and wires the payment. Once the transfer is completed the money is in the hands of the thief and has likely been lost forever.
How Can You Stay Protected From Wire Fraud?
Investors Title Company has policies in place to help protect individuals from fraud. Our title company does not require that your client send a wire for closing, and will never email your client to request a wire. Before sending wires on customers’ behalf, we require the customer to complete our Wire Authorization form in person and provide a cancelled check of the receiving account.
Here are steps you and your clients can take on your own to prevent wire fraud:
- Don’t Email: Call to confirm your wiring instructions by phone using a known number before transferring funds. Don’t use phone numbers or links from an email.
- Be Suspicious: Title companies do not change wiring instructions and payment info by email.
Protect Your Money
- Confirm Everything: Ask your bank to confirm the name on the account before sending a wire.
- Verify Immediately: Within four to eight hours, call the title company to confirm that they received your money.
What To Do If You’ve Been Targeted
- Immediately call your bank and ask them to issue a recall notice for your wire.
- Report the crime to www.IC3.gov.
- Call your regional FBI office and police.
- Detecting that you sent money to the wrong account within 24 hours is the best chance of recovering your money.
No other title companies in St. Louis match ITC’s commitment to customer care and excellent service. If you want to work with a title company you can trust, find an Investors Title Company office near you, or request a title order or quote online today.