I just heard a horrific story about a couple purchasing a home in the valley and losing their $80,000 downpayment to wire fraud – Lost, vanished, gone and never coming back. They received an email from what appeared to be the escrow officer, with instructions to wire their downpayment a few days prior to closing. When the actual escrow officer contacted the buyer to instruct them on how to bring or wire their funds to title, imagine the shock when the buyer asked “didn’t you already get the wire I sent you a few days ago?”. Both the buyer and the escrow officer felt like they were punched in the gut as they realized what had happened. And the dominoes fell hard. The buyer lost the home, the seller of the home had to put it back on the market after 40 days of waiting to close, and the home the sellers were to buy once their home closed now fell through as well. LOTS of unhappy people and a devastated victim of cyber crime. This is not an isolated case. Over the past few years, we’ve seen a huge increase in cyber crime. What can you do to keep yourself safe from wire fraud?
The first and most important step you can take is to make sure that you do not take any action on wiring funds unless you have verified that the wiring instructions have come directly from your title or escrow officer. With sophisticated hackers able to recreate emails so similar to that coming from title, your Realtor, or your lender, you should always call the sender at a phone number you’re familiar with when being asked to move any money ANYWHERE!!! Had the buyer above contacted the escrow officer to make sure the instructions came from her, this cyber crime would not have happened.
Do not give out your bank account or social security number to anyone unless you can verify both the need and the safety of that information. Remember that your Realtor will never ask for this information. And while your lender and title company may require it, they will go to great lengths to protect your identity and information. Make sure when you send sensitive information that you ask the recipient to use password protection or encryption to keep yourself safe from wire fraud.
Bring closing funds to title in the form of a cashiers check. These days, to keep yourself safe from wire fraud, it seems like a good old fashioned paper check is a good form of payment if you don’t want to risk a wire going sideways. Just make sure you keep it in a safe place before handing it over to title. And, you’ll save a little money as well. The cost of wiring funds is typically higher than obtaining a cashiers check.
Make sure you have virus protection on your computer to ensure that hackers aren’t fishing for information about you, your home sale or purchase, or your financial data. Certain malware can wreak havoc on your
Finally, use common sense and listen to your intuition. If something sounds a little fishy, take the extra step to confirm and verify that you know who you’re dealing with at the other end. Given all of the ways we communicate these days, and the speed at which we all seem to operate, it’s becoming easier for fraud to occur. Be diligent about checking before you provide any sensitive data. Don’t be afraid to be a nuisance in verifying all communication, and take steps to make sure that wire fraud is one less thing you need to worry about in purchasing or selling a home.