Fraudsters
We were on a Zoom call and somebody said, “Why am I ‘required’ to change passwords all the time? I’m sick of it. I can’t keep track of all my stupid passwords because I’m always changing them! I change passwords like I change my socks!”
The Computer Tech guy was on the call and he said, “You protect yourself by locking your house don’t you? You lock your car don’t you? You protect your online house by locking the doors with new passwords.”
It brought to mind a recent crime against one of our Real Estate clients. The crime went down this way:
Jason Anderson hit “Send” on his laptop screen, instantly delivering $37,429.87 from his bank account, by electronic wire fund transfer, to the Title Company handling his escrow for the purchase of his first home. The money is Jason’s down payment and closing costs.
On the receiving end, it’s not the Title Company that is receiving the wire transfer of Jason’s money. Rather, it is some faceless fraudster who undoubtedly rubs his hands together in glee. He has successfully coerced another sucker into sending him great sums of money. The faceless fraudster hits a few buttons on his keyboard, and Jason’s money is moved to another account and then another account, fake names and numbers are attached, and it can’t be traced or found by anyone other than the faceless fraudster.
Jason calls his Realtor, Pam.
“Hey Pam,” says Jason, “I guess we’re getting ready to close escrow. At last, the house will be mine!”
“Yes!” says Pam. “Finally! Loan Approval!”
Jason’s loan approval was a tough one. As a self-employed contractor, he didn’t fit in all the loan boxes of the ideal buyer, so he had to come up with more down payment money, including $15,000 from his Grandparents.
“So when do we close?” asked Jason, “I just wired my closing money to the Title Company.” “Wait. What? We’re not closing for a week!” said Pam.
“The Title Company sent me an email that gave me the wiring instructions. They said they needed it by ten o’clock. So I wired the closing funds from my bank account. Right?”
But those wiring instructions came from the faceless fraudster, who had hacked his way into Jason’s email account.
The fraudster employs the devious technique of hacking email passwords, and then scanning inboxes for money-related emails. He finds emails about a transaction underway and waits for the right time to order his victim to cough up the money. He sends a spoof email that looks just like it came from the victim’s Title Company, Realtor, attorney, lender, bank, you name it.
There are lots of fraudsters. They have sucked up lots of money from victims like Jason.
Katie Johnson, General Counsel for the National Association of Realtors says wire fraud is the number one “legal friction point” for Realtors. “Millions of dollars are lost this way,” she said. “Once the client sends it, the money is gone.” She laid out the rules for protecting against the fraudsters.
1. Never send money without verifying with a phone call. 2. Change your email password every two weeks.
Jason lucked out. His fraudster messed up his own wiring instructions and had to physically go to the bank to straighten it out. The Title Company fraud investigators busted him.
Jason bought his house, and the fraudster is now a fraudster in jail. But there are many more fraudsters scanning email inboxes right now, for all kinds of stuff, not just Real Estate.
Change your password, whether or not you change your socks. Right now!