Real Estate Closing Scam
Professionals and consumers in the real estate business should be aware of real estate closing scams. It is important to be aware of the variety of scams and create habits of verifying everything you do along the way in your real estate closing processes.
Real story: Hijacked email account and directions on sending funds
Mike Favia warns people about the story of a real estate attorney was targeted in a real estate closing scam, where his client’s funds were almost stolen by being sent to the wrong bank based on his hijacked email account. Fortunately, the client, upon receiving this fictitious email instruction to send the closing funds to some other unknown bank, contacted his office to confirm the new instructions and were told that they did not send the email.
Mike also notes that the title companies with which he works have been warning the real estate attorneys and other professionals involved about this fraud, for some time now, but it’s getting worse and worse.
The common real estate closing scam works as follows:
A hacker needs to break into the email account of a realty agent or title company and look for information about cash closing transactions on homes. As the hacker monitors the emails they can figure out the identities of the buyers, sellers, title company, escrow service providers and the timing of scheduled closings. Then, once the hacker can take over the real estate agent’s email account they can take over the account and email money transfer instructions to their clients.
Meanwhile, the real estate agent has no idea that a hacker just took their email account over and gave buyers bogus instructions that send closing money directly into the scammer’s account. Once the money has been transferred to the account that soon disappears or is untraceable, the money could be gone.
Use this link to view a full article about this scam by a popular financial publication, This Real Estate Closing Scam Could Cost You Your Home; Here’s How To Protect Yourself.
Be proactive in preventing and stopping a real estate closing scam
- Communicate with everyone on the phone or in person
- Verify everything, especially anything that changes in the transactions
- Use encrypted email server and a real estate agent who uses one as well
What can you do if you are a victim of a real estate closing scam?
- Contact law enforcement and a lawyer
- Contact all the banks involved to stop the wire
- Change usernames and passwords for financial sites
If you have questions or concerns about safe real estate transactions, call Michael V. Favia & Associates.
Mike Favia and his fellow colleagues who work as attorneys and real estate professionals pay close attention to real estate scams and fraud schemes to help protect their clients and themselves. If you have questions about fraud or have been a fraud victim, call the Chicago law firm of Michael V. Favia & Associates by dialing (773) 631-4580.