How often does cybercrime happen? According to the Federal Bureau of Investigation, there is a hacker attack every 39 seconds. They predicted that 33 billion accounts would be breached in 2023. This is 2,328 per day and 97 cybercrime victims per hour. To date, over 8 million cyber-attacks have been reported.
Wire fraud is one of the more popular methods of quickly obtaining cash from unsuspecting customers in a variety of industries. However, as the home purchasing process has become more digitized, sophisticated cybercrime tactics have emerged as a significant threat to the housing industry and its customers.
Wire fraud occurs when a cybercriminal gains access to an email account or computer system, accessing customer information, including names, email addresses, property addresses, closing dates, and down payment amounts due at closing. The cybercriminal then emails the customer, impersonating the title company escrow officer, with an official-looking document, including the title company’s logo and contact information. The email contains fraudulent wire transfer instructions to the buyer or seller, directing them to wire funds to a fake account. Once the funds are transferred, they are quickly withdrawn, making recovery nearly impossible. There is usually a sense of urgency to immediately wire funds that day to avoid a closing delay. It can even appear to the customer that the mortgage company and realtor have been included in the email, but the email address has been slightly altered, so it is never received by any of the real companies involved in the real estate deal.
So, what can a customer do to protect themselves? Here are some red flags to help you not fall victim to wire fraud scams:
Red Flags
The email address of the title agent, Loan Originator, or realtor has changed, or the email address that sent the communication does not match the email address on the signature of the email. Look for Title@closing.com and Title@closing-email.com.
Reach out to your mortgage company directly if the title company is asking to send a wire for closing prior to closing being scheduled.
The communication does not come from a secure external site that makes the borrower set up a password.
The “title agent” is pushing for a confirmation number for the wire.
The Closing Disclosure that the mortgage company provides the borrower should not be provided again by the Title Agent.
What to do?
Review the email addresses for changes.
Consider changing your personal email password.
Who is on the communication? If it is just you and the title agent, call your mortgage company and ask questions.
Call the title company to verify that you were supposed to receive instructions for closing.
Contact your mortgage company to verify closing and how you should be paying closing costs.
Do not click on any links or call the phone number in the letter without verifying the phone number is actually the title company through a different source, such as their company website, before calling.
Ask questions before doing anything!
It is an unfortunate reality that we must all be vigilant about verifying the identity of anyone requesting money before taking action. By checking a few of these details, you could save thousands of dollars from being stolen right before closing on your new home.
