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12 steps to prevent wire fraud

August 22nd, 2017 8:41 AM by Salim (Sam) Kader MLO# 130505

Wire frauds are on the rise. A hacker can break into a licensee’s email account (typically using phishing scheme) to obtain information about upcoming real estate transactions. After monitoring the account to determine the likely timing of a close, the hacker sends an email to the buyer, posing either as the escrow agent or as the licensee. The fraudulent email may contain new wiring instructions or routing information, and request that the buyer send funds accordingly. They could just as easily send an e-mail to the escrow agent posing as a Seller or a Real Estate Broker instructing the escrow agent to wire seller funds to different account rather than to the account provided at the signing. The wire instructions usually include legitimate American bank. However, once the funds are transferred, it will be wired out of the county. Once the money is out of the country, it is almost impossible to retrieve.

Here are steps to prevent you from becoming a victim:

1. Be sure to obtain, confirm and note the phone number and email address of both your real estate agent and escrow contact by direct phone call to them.

2. Review email instructions carefully and do not click on any links without confirmation that the email is from your escrow officer or real estate agent.

3. Always look closely at the email address of the sender. Be cautious of ANY variance in the sender's email address - for example is not the same as  When responding to an email, hit forward instead of reply and then type in the recipient's email address. 

4. Escrow company or the bank SHOULD NOT accept disbursement instructions or changes to disbursement instructions in the middle of transactions via e-mail. Should a circumstance arise that requires disbursement instructions be sent via e-mail, it must always be followed by contacting the client to confirm the information received using a pre-verified phone number.

5. Escrow company should always email wire instructions using encrypted email. If your client receives wire instructions via email - ALWAYS follow up with a phone call to escrow close before they wire funds. 

6. Pay attention to the wording of an email requesting funds. Many fraudsters are “offshore” offenders and their sentence structure may be broken and may contain misspelled words or improper grammar such as "routing number" as "routine number".

7. Beware of e-mail spoofing. E-mail spoofing is the forgery of an e-mail address so that the message appears to have originated from someone other than the actual source. For instance, you could receive an e-mail that you believe originated from your Escrow Closer or Broker because the e-mail address is the same as theirs (see item 3 above). However, if you click on the e-mail address it will disclose the true e-mail address of the originator. E-mail Spoofing is a common tactic used in wire fraud campaigns and if you are not familiar with the tactic you are very likely to follow the instructions contained in the e-mail, believing they came from the proper party.

8. Be wary of a sudden or urgent request for funds that were not anticipated or required as part of the transaction. Examples include a request for an additional earnest money deposit or extension fee that was not part of the purchase agreement.

9. Install effective malware on your computer an update it regularly (I use Norton security).

10. Think before you click on a link or open a zip file. If you don't know the sender, DO NOT click of open on it. This is how phishing scheme works. (If you feel that you've been hacked - disconnect all connection to the internet and consult with computer expert).

11. Do not use open/free/unsecured Wi-Fi, use strong, unique passwords along with using a secure authenticated email delivery system.

12. Avoid trigger terms as an email subject lines such as Proceeds, Payment, Funds, Wire Transfer, Account and Escrow.

Posted by Salim (Sam) Kader MLO# 130505 on August 22nd, 2017 8:41 AM



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