The Federal Trade Commission (FTC) and the National Association of REALTORS® have announced concerns over closing cost scams.
Wire Fraud Scam
Here's how the scam works: Hackers break into a consumer's or real estate professional's email account to search for upcoming real estate transactions and closing dates. Then, hackers pose as the agent or title officer and email the homebuyer with a last-minute change to the wiring instructions.
Should buyers wire money to the account, they will lose the money and likely lose the home they've been waiting for due to a lack of funds.
Here are a few things you can do to make sure your clients don't fall victim to this scam:
Ensure you have a united effort between agents, loan officers, closing attorneys and title officers to remind buyers of the dangers of this scam.
Verify that changes to wiring instructions will not be requested by email. Remind buyers to be alert. They should not follow instructions regarding closing funds solely from an email but when instructed to do so in person or by phone.
Add a brief warning to your email signature that reminds clients to remain cautious about suspicious messages during their transaction, especially near closing. Do not conduct business over public Wi-Fi and be cautious about links that you click on.
As an agent, transaction information is a highly valuable target for scammers and hackers. Use secure document technology such as DocuSign or zipLogix for sharing and signing any sensitive documents.
Remember, email is almost never a secure communication platform, so take precautions to protect your clients.