Today’s topic focuses on cyber fraud and real estate transactions while focusing on the ever present threat of cyber fraud and the implication is has for your real estate transaction. Like most businesses where money is involved, we are seeing an alarming trend in cyber fraud in the real estate sector. Consequently, lawyers conducting real estate transactions and title companies conducting real estate transactions have recently been the target of a lot of cyber fraud scams.
The way it generally works is the lawyer or title company will receive false instructions concerning money that was sent to the lawyer’s office or to the titles agent’s office via email. If the title agent or lawyer isn’t careful they will use those fraudulent wire instructions to disburse funds once the transaction is closed.
Unbeknownst to the attorney or the title company the funds are now in the hands of the fraudsters. Worse yet, the people expecting to get paid end up getting nothing. Obviously that’s a bad day for the buyer, seller and everyone involved.
These criminals will also hack lawyer’s, real estate agent’s or title agent’s emails to dupe anyone into sending an unlawful wire transfer. This scam typically involves a last second change to the wiring instructions.
These scammers are always looking for new ways to circumvent the system and steal from others. For instance, in this prior blog post we document how scammers are utilizing fake phone systems to “spoof” calls from legitimate organizations like the IRS. The calls may actually appear to be legitimate on your caller ID. But they are not.
Therefore, it is critical that lawyers and title companies follow the advice of their title insurance underwriters who are strongly recommending that any instructions received regarding money via email be verified by phone with the sender.
This way mistakes are avoided and the closing goes smoothly even after.
We encourage you to always double check information when it comes to transferring money. If you have any questions email us or give us a call here at the office, we are here to help.