Don’t Be a Victim of Wire Fraud

 In Advice for Home Buyers, Advice For Home Sellers

As work and life and business becomes ever more digital, so increases the chances of being harmed. Identities are stolen, bank cards are hacked, email accounts are infiltrated.

In November, a retired Missouri couple was in the final escrow stages of purchasing their forever home near their daughter in the town of Independence. After years of scrimping, saving, a living a frugal life on a Pastor’s salary, Ross and Melinda Fulton were excited to be able to pay cash for their home.

The buying process had been normal up until the final moment. They had communicated via e-mail regularly with their real estate agent and mortgage lenders. Before their closing date, they received an e-mail that seemed normal. It read:

“Hello Ross and Melinda, In preparation for your closing on the 30th of November. The closing balance will be required to be wired 26th of November. I would like to know if you will be able to perform the wire on the 26th, so I can inform (actual title company’s name).”

It was signed “sent from my iPhone.” They responded that they would be arriving at closing with their checkbook. The response they received? It was this:

“Hello Melinda, Due to the increasing incidence of fraud with certified bank checks, we will require all funds needed for closing to be tendered in the form of a wire transfer. We no longer accept certified checks as good funds.”

The e-mail appeared to have been sent, as usual, from their real estate agent. Because they were paying the full amount for the house, the Fultons wired a staggering $130K to the apparent title company noted in the email traffic. In the end, they had been communicating with a scammer and lost their entire savings in one fell swoop.

Unfortunately, with living in a digital age comes people who manipulate things to their advantage. Professional scammers have found ways to monitor e-mail accounts. This particular scammer knew the address of the home they were buying, the title company’s name, the closing date, everything. All because they had gained access to e-mail accounts unknowingly.

We don’t share this to fear monger. There ARE ways to protect yourself. Here are a few things to look for when conducting real estate business online:

  • Always, always, always call to verify wire fund directions if you really need to do a wire transfer.
  • Watch email addresses closely. In the Fultons’ case, their realtor’s email and the scammer’s email were similar but with different formats. We’ve changed names, but this is the format used: (real) vs. (fake)
  • Watch for syntax errors like words missing and changes in sentence structure. Also, different words than how one might talk. Look closely at the errors made in one of the e-mails they received:  “The closing balance will be required to be wired 26th of November. I would like to know if you will be able to perform the wire on the 26th, so I can inform”
  • Watch for a change of sent from origin. If all correspondence has been done over email up until this point, but suddenly there’s a “sent from iPhone” at the end of the email, that might be a red flag.

In the end, just take your time and slow down. If you’re dealing with money, it pays to be thorough.

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