The Colorado Division of Real Estate at DORA (the department of regulatory agencies) is reporting about computer hacking fraud. Dora is warning real estate consumers to be aware of a national cyber scam currently taking place. Apparently, cyber criminals are hacking into email accounts of real estate brokers, title companies and consumers who are in the process of buying or selling a home. In other instances the hackers create alternate email accounts with just minor changes to the name of the email account which typically goes unnoticed by the recipient of the email.
Unfortunately, the cost of this scam can be in the tens to hundreds of thousands of dollars with just one successful scam. Pay very close attention, everything may look like the email signature address and website but by the time the homebuyers realizes something is wrong the money is already gone and in an untraceable bank account leaving them at the table with no money and eliminating their ability to purchase the home. This last February a Denver Colorado real estate seller lost over $80,000 from the sale of the property to one of these scams.
How do the scams work you may ask? Often the computer hackers monitor email exchanges between the parties of a real estate transaction and gain specific information such as the buyer and seller names, subject property address and phone numbers and as the closing date approaches and arrangements are made to wire the money to the closing company or wire the proceeds from the sale of the house to the sellers the scammer will send a last-minute email from a hijacked account or similar-looking email address updating the wiring instructions to request the money be transferred into a fraudulent bank account. The email looks legitimate and often contains the transaction specific information to hackers obtained in the body of the email or as an attachment. One way to avoid this would be to simply go into the bank yourself in person and deal with it that way. I would also recommend getting a check directly from the title company at closing and skirt the wiring of seller funds altogether.
The increasing technical sophistication of computer hackers require us to take the following action:
- Verbally contact your Broker prior to wiring any money. You should always verbally contact a real estate broker to confirm that the wiring information is accurate. Do not rely on telephone numbers or website addresses provided within an unverified email.
- Do not email financial information emails and texts. They are not secure methods to transmit financial information. Keep a record of websites that hold your financial information and before providing that information confirm that the websites in which you input financial information are secure look for the URL to start https stands for secure.
- Don’t click on links. Don’t use links to get to websites. Instead search and find the company and directly go to their website from your search. As a tech savvy real estate agent I can’t stress this one enough.
- Lastly update your computer keep your operating system browser and security software update.
Finally, don’t be embarrassed, you should report any fraudulent activity to the Federal Bureau of Investigation through its internet crime complaint center immediately you could save other consumers from a lot of hardship.