While technology has added convenience to the closing process, it has also opened home buyers to a potential risk - wire fraud. What is wire fraud? Wire fraud is when a hacker uses an email that appears to be sent by the home buyer's real estate agent or title officer but is actually from a compromised address. The email often directs the buyer to wire funds into an account (fraudulent), citing a last-minute change in wiring instructions or payment information. Hackers can also monitor real estate agent’s email activity to watch for pending transactions. They can hijack the wire intended to go to the title company by simply changing the routing number and account information. All of this behavior can easily slip through an unknowing buyer’s eyes.
So... what can you do to protect yourself?
Despite efforts by the title industry and others to educate consumers about the risk, homebuyers continue to be targeted. Here are some tips on what you can do to protect yourself and/or your clients:
Call, don't email:
Confirm all wiring instructions by phone before transferring funds. Use the phone number from the title company’s website or a business card. Denver Title Alliance's mainline is 303.831.7575.
It’s not common for title companies to change wiring instructions and payment info.
Confirm it all:
Ask your bank to confirm not just the account number but also the name on the account before sending a wire.
You should call the title company or real estate agent to validate that the funds were received. Detecting that you sent the money to the wrong account within 24 hours gives you the best chance of recovering your money.
Forward, don’t reply:
When responding to an email, hit forward instead of reply and then start typing in the person’s email address. Criminals use email addresses that are very similar to the real one. By typing in email addresses, you will make it easier to discover if a fraudster is after you.
*Information provided by the American Land Title Association.