Protecting Your Real Estate Investment: Avoiding Wire Fraud
Sensitive information plays a critical role in your real estate transaction, and it’s imperative that this information remains safe and protected. While companies strive to provide consumers with peace of mind through data security and email encryption, there are essential steps you can take as a consumer to protect yourself from cyber-fraud.
A Real-Life Cautionary Tale
Recently, Rana Robillard, a tech executive, lost nearly $400,000 to a sophisticated wire fraud scam while purchasing a home in Orinda, California. After winning the bid on her dream home, she received an email that seemed to be from her mortgage broker, instructing her to wire the down payment. Trusting the email, she sent the money, only to realize later that it was a scam. You can read more about her story on CNBC.
Recognize Common Indicators of Cyber-Fraud
Fraudsters often hack into email accounts involved in real estate transactions and wait for the perfect moment to deceive victims. Here’s how you can recognize and avoid falling victim to such scams:
Last-Minute Changes: Be wary of emails requesting last-minute changes to wiring instructions, especially changes in the beneficiary or receiving bank.
Odd Timing Requests: Be cautious of wire transfer requests late in the day, week, or outside of business hours.
Poor Grammar: Look out for emails with poor grammar or typographical errors.
Slight Email Variations: Pay attention to small, often unnoticeable changes in email addresses (e.g., msmith@stewartttitle.com instead of msmith@stewarttitle.com).
Suggested Best Practices
To protect your sensitive information during real estate transactions, follow these best practices:
Use Encrypted Emails: Send emails with sensitive, personal information through encrypted email only.
Verify Requests: Always verify requests to change wiring instructions through a trusted method, such as a previously verified phone number.
Avoid Unverified Links: Never click on links in unverified or unexpected emails and always question unencrypted attachments and links.
Check Wire Transfers: Verify wire transfer requests to locations outside normal business areas.
What to Do if You Believe You Are a Victim of Cyber-Fraud
If you suspect you’ve wired money in response to fraudulent instructions, take immediate action:
Contact Banks: Immediately call all banks and financial institutions involved to put a stop to the wire or recover your funds.
Report to Authorities: Contact your local police or real estate fraud division and report the cybercrime activity to the FBI Internet Crime Complaint Center at www.ic3.gov/complaint/default.aspx.
Notify Others: Inform any other parties who may have been exposed to the fraud.
Change Credentials: Change all usernames and passwords associated with compromised accounts.
Staying Safe
Robillard’s experience serves as a powerful reminder of the importance of vigilance and proactive measures in real estate transactions. By staying informed and cautious, you can protect your investment and ensure a smooth path to homeownership. If you have any questions or concerns about your real estate transaction, don’t hesitate to seek advice from trusted professionals.
