Growing Threat of Email Scams in Real Estate

Growing Threat of Email Scams in Real Estate

Growing Threat of Email Scams in Real Estate

Protect Your Business and Your Customers from Email Threats

Real estate professionals are not immune to online scams. Recent evidence points to a growing rate of email scams in the industry. In a report last month, the British National Fraud Intelligence Bureau (NFIB) alerted real estate professionals in the wake of a large scale scam from foreign criminals who stole more than 14 million dollars. By breaking into the email accounts of real estate buyers, sellers, estate agents and attorneys, the criminals would wait until a deal was about to close and then send fake emails stating that the bank account details had been changed.

Hiding Behind a “Trusted Source”

Because the fraudulent emails come from a trusted source (the hacked account), victims are often unaware that they are being scammed. Once the money has been transferred into a foreign account, it is usually too late and the money is impossible to trace.

On American shores, the National Association of Realtors (NAR) issued an urgent alert last month about scams targeting real estate professionals as well as their clients. Like the UK situations, the scams involve the use of hacked data that fools recipients into thinking there has been a drastic change in wiring instructions. Naturally, buyers and sellers who are eager to close on their property are far more likely to follow these fake instructions. If they do, they wind up wiring funds to the scammer’s account, which is immediately closed out.

This alert is especially timely as real estate professionals rush to complete their winter and spring closings. As we move into a high-activity real estate environment this spring and summer, it becomes the perfect targeting environment for predatory hackers.

Recommended “Scam Prevention” Strategies

The NAR recommends a number of measures to prevent becoming the victim of real estate of scams:

  • ASAP: Contact all parties of upcoming transactions and inform them that this type of scam is present and prevalent. Attorneys, escrow agents, buyers, sellers, real estate agents and title agents have all been targets in this scheme.
  • If possible, don’t send sensitive information by email. Use encryption to ensure security.
  • Immediately prior to wiring any funds, the person sending the funds must call the intended recipient to verify wiring instructions. Only use a verified phone to make this call.
  • Never trust contact information in unverified emails. Hackers will meticulously recreate legitimate-looking signature blocks, logos and other information, including links to fake websites to convince victims that the email is authentic.
  • Never click on links in an unverified email. In addition to sending victims to fake websites, they can also infect computers with viruses and other malicious spyware that can make transactions vulnerable to attack.
  • Trust your instincts. Tell all clients and applicable parties that if an email or phone call seems suspicious, they should refrain from taking action and call you immediately.
  • Clean out your email regularly. An email archive may allow a hacker to establish patterns and habits in your practice that they can use against you.
  • Change your usernames and passwords on a regular basis and make sure you encourage your clients to do the same.

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