Real Estate wire fraud is on the rise. Buyer's need to be aware never to transfer funds into an account per instructions received via email. Instead, they should contact the escrow company personally to confirm any account numbers before they transfer funds.
Escrow company's are responsible for any lost funds when they transfer money out of their accounts, however, buyer's are responsible for all funds transferred into the lenders account. Thus, if the funds are transferred into a fraudulent account, those funds can be lost forever with no way to recover them and the buyer is out the money and won't get the home.
Hackers have become quite savvy with logging into email accounts and watching what is happening with a transaction. They can then start sending you emails that appear to be the real estate broker, the lender, or the escrow/title company involved in that transaction. The hacker can use the same logo and have the same branded appearance.
Here are some tips to help prevent against wire fraud according to an article in RealEstate.Boston.com:
-Brokers should tell their client that everyone is exposed to the risk of wire fraud, but explain what precautions they will use to guard against theft.
-Brokers should stress to the home buyer that any change in the transfer of funds will be discussed face to face to ensure the validity of the request.
-It’s recommended that agents, realtors, attorneys, every party handling property transactions use only those devices that are on secured Wi-Fi networks encrypted to prevent “break-ins.’’
-Everyone involved should change their passwords frequently; use only complex, impersonal character combinations; and write different ones for every site.
-Real Estate Brokers and attorneys should use company e-mail addresses. Ex. Name@SolutionPartnersNW.com. It’s more difficult for hackers to create a duplicate company e-mail address than a Gmail or Yahoo one. And look for subtle differences: Jane.Johnson@gmail.com could very easily become Jane.Jonson@gmail.com.
-Clients should pay attention to the URLs, the e-mail addresses, and the times of day they’re receiving correspondence from the parties in the transaction.
-Report suspicious activity to the parties involved.
So it is better to be safe than sorry and confirm any wire transfer number directly with the escrow company before sending the money.