We want to do everything in our power to educate our clients about the increasingly serious problem in real estate known as wire fraud. The Federal Trade Commission (FTC) and the National Association of REALTORS (NAR) have both issued warnings against this current scam while helping to explain what happens with a fraudulent wire transfer.
“Hackers break into the email account of a consumer or real estate professional to determine the date of an upcoming closing. They then use that information to send a fraudulent email to the buyer, posing as one of the professionals involved in the transaction. The email contains wiring instructions that are allegedly tied to the closing, but which actually rout directly to the scammer’s account. If a buyer is fooled, they may see their bank account wiped out.” – The NAR’s
Getting into this kind of mess can be a nightmare and unfortunately is becoming too common in real estate transactions. Hackers break into the email systems of sellers and buyers and send bogus emails requesting wire transfers to fictitious accounts.
Here’s part of what the FTC had to say in a recent blog post:
“Don’t email financial information. It’s not secure…If you’re giving your financial information on the web, make sure the site is secure. Look for a URL that begins with https (the “s” stands for secure). And, instead of clicking a link in an email to go to an organization’s site, look up the real URL and type in the web address yourself…Be cautious about opening attachments and downloading files from emails, regardless of who sent them. These files can contain malware that can weaken your computer’s security…Keep your operating system, browser, and security software up to date.”
Here are 4 tips from Jensen and Company to protect your financial information:
- Always verify wiring instructions with your team of professionals before you wire money to an escrow account. Don’t send your money until you are 100% sure!
- It is a red flag when wiring instructions CHANGE during a transaction.
- Always be on guard and never assume “everything is fine.” You can ALWAYS call your real estate agent – it’s what they’re there for.
- The only people who should be asking for your money is your escrow company, never a third party.
- Due to Utah Good Funds laws it is better to send a wire to the title company if it is over $10,000.
Don’t fall victim to these scams. If you are sending or receiving money via a wire transfer, be completely sure that the person/company you are dealing with is vetted and legitimate via a personal verbal verification or phone call. Our advice would be to always assume an email for a wire transfer is fraudulent until you can confirm for yourself the authenticity of the sender and the detailed information included in the email.