As the home buying process comes to an end and you’re looking forward to a new and exciting adventure in homeownership, we want to ensure that you take the neccessary precautions to avoid falling victim to wire fraud. With the increased use of technology, we’ve come across numerous stories of theft and attempted theft, during the close of the home-buying process.
Due to quick thinking and attention to detail, one of our clients was able to safeguard themselves against a tragedy. We want to share a cautionary tale about this experience, from our agent’s perspective and give tips on how to avoid this type of theft in a transaction.
“Our client was set to meet me at the title company on Wednesday to sign loan papers. They were heading out of town on Tuesday tor a short trip to meet up with a family member. They were driving and received an email message from what appeared to be the escrow officer at the Title Company. The message said that they needed to wire their funds to the Title Company that day. The message said it would delay the closing if they did not. There was an attachment that looked familiar: The Estimated Closing Statement. It was not correct.
They responded that they would stop by their Bank en-route to where they were going. They requested the instructions to complete the wire. It seemed odd since were were not expected to close until early the following week. They called the number on the signature line for the escrow officer and it was not in service. So they looked up the Title Companies main office number and called. They asked for the Escrow officer, the receptionist told them she was on vacation. So things started to become clear there was a breach. The client spoke to the escrow officer that was taking over and had them forward the message to her. She reviewed the email and saw a number of incorrect spellings and information.The lender was called and she indicated she had received a message requesting the email addresses for the client. She had sent it on. It was apparent there had been an attempt to have the clients wire funds to an account that was not the Title Company. The client was very much aware of the “wire fraud” issue and thankfully they figured it out before any funds were sent. As our common practice is to communicate via our smart phones, it is more difficult to actually read all the information and we tend to glance over the details and get the essence of a message.The Title Company is very concerned that wiring funds is becoming a bigger issue and another way that is more secure to receive funds needs to be considered. Unfortunately it is a challenge with the world we live in wants everything to be done immediately. Also with so many of our clients that we do business with are out of our area it is also convenient. Cashier’s checks are held for 24 hours per the Title Company and personal checks are much longer. It is hard to slow the process down but until another secure option is presented we just might want to take a breath and take the extra time.”
As explained by The Washington Post, wire fraud continues to be “the fastest-growing form of real estate cybercrime in the United States: thefts of home-purchase money wired to complete closing transactions.” Given the prevalence of this crime, safeguarding yourself against wire fraud is more important than ever.
Wiring money is typically an essential component of the home buying process and can’t be avoided. So, follow the steps below to avoid falling victim to wire fraud when you purchase a home:
Call your title company in order to verify that the wire instructions you’ve received are correct. Theifs have been known to spoof emails that appear to come from your title company and provide instructions for transfer of your funds into their hands. Even if you think the emailed instructions came from a reliable source, never skip this step! Title companies understand the danger of wire fraud and will be happy to verify the wire destination over the phone.
TIP – Be sure to use a phone number you’ve obtained in person or in verified paperwork. You can also verify a phone number via online websites such as Google, Yelp, or the company’s webpage.
Read the entirety of your wire instructions. Typos or mentions of foreign companies are red flags.
Consult your real estate agent. They deal with countless wire transfers every year and have the best interest of your successful home purchase at heart.
By following these three simple steps, you can take control of your home-buying destiny! Never fall victim to losing tens or even hundreds of thousands in the midst buying a home.
Wire fraud tips provided by Live Urban Denver