Wire fraud stresses out a couple trying to buy their dream retirement home; what should they do?

On Thursday, the buyers of our home wired their down payment to someone impersonating our escrow officer. The buyer’s agent forwarded nefarious wire instructions. It is not clear if the buyer’s agent or escrow officer had their email accounts hacked. Nonetheless, to his credit, the buyer’s agent is taking responsibility. He did not verify the wire instructions or scrutinize the bogus email. The buyer’s agent claims he has real estate agent insurance in place. In the meantime, the sellers of the home we are buying have granted a two-week close-ofescrow extension. The buyer’s agent claims they will close

escrow once his insurance covers the loss. However, our seller’s agent claims we should relist and resell our property. Meanwhile, the seller’s agent on the home we are buying is threatening to relist and sell our dream retirement home. Who should sellers in our incredibly stressful situation believe?

The real estate attorney who comes highly recommended. That’s the person who has the experience to gather the facts and help you navigate what you’re about to experience.

That buyer’s agent probably has never read his Errors & Omissions (E&O) insurance policy. Chances are he does not have a cyber policy that includes cybercrime coverage, including social engineering. The online definition of social engineering is: “The use of deception to manipulate individuals into divulging confidential or personal information for fraudulent purposes.” He might not be one of the few agents with limited cybercrime endorsement coverage of $25,000 to defend a fraudulently induced funds-transfer case.

Last week, I heard about three successful escrow wire-fraud cases of $200,000, $980,000 and $2,000,000. It is commendable that the buyer’s agent is accepting blame. But the E&O insurance companies put so many qualifiers on the limited defense fund of $25,000, chances are agents will never see it.

Cybercrimes still occur even though the agents and their clients have received a wire fraud disclosure, such as the California Association of Realtors’ Wire Fraud and Electronic Funds Transfer Advisory (C.A.R. Form W.F.A.). If possible, hand-carry a bank check to an escrow officer. It puts a place and face on the escrow office and escrow officer. For that to happen, you’ll need your house back on the market ASAP with the help of a real estate attorney.

Realtor Pat Kapowich also shares proven consumer-protection strategies for homebuyers and home sellers at YouTube.com/PatKapowich and SiliconValleyBroker. com. Contact him at 408-245-7700, Pat@ SiliconValleyBroker.com DRE# 00979413