Tips Offered to Avoid Loss
Long Beach Island, NJ — Wire fraud is on the rise, even reported on Long Beach Island – and scammers are targeting homebuyers through a version of “email access compromise,” a local real estate firm told the SandPaper. Cases have been reported where a scammer impersonated a title company and intercepted funds of a buyer right before the closing.
Practice of wire fraud starts with a buyer getting an email that appears to be from their title company, often changing wire transfer instructions. If the buyer follows the instructions, the money goes to a fraudulent account and is lost. Because the buyer is authorizing the wire transfer, the usual protections don’t apply.
The following list of strong recommendations to avoid wire fraud are advised by the area Realtor whose buyer client experienced the situation on their personal computer.
1. Call to confirm – never wire funds without talking to your confirmed contact at your title company or law office to confirm wire details. Do not call the phone number on an email; call your agent, lawyer or title contact that you personally know.
2. Pay attention to details – During a transaction, multiple emails come from your agent, lawyer and title company, so a fictitious email from an impersonator/scammer can go unnoticed. Look closely at your email; scammers often have all parties copied but will change a letter on the other emails, so the other parties are not actually copied, but at a glance look copied.
3. Changes are red flags – Last-minute changes for your payment method or new wire instructions need to be addressed immediately with your attorney and title company. Do not call the number on the email; you may be calling the scammer.
4. Secure your emails and computer – Don’t send sensitive data through email. Use the secure file-transfer service to send documents. If more documentation is required and the source is an unsecured email, be suspicious and contact your attorney or title company immediately. Keep your computer operating system and anti-virus software up to date. If two-factor authorization is available, always use it. Make complex passwords.
5. Payment method/instructions – Some title companies will not give all of the numbers on the wire and give the missing digits verbally. Other companies will fax instructions. The bottom line is don’t trust emailed or faxed closing instructions. Call a number you know to confirm, not the number on the email or fax.
The goal of the Realtor whose client suffered the loss is to educate the public to the vulnerability that can occur.
The realty firm uses a paid service for email, so its emails are encrypted and require a two-step authentication. However, the fraud in reported cases is happening with the buyer’s email.