Email Wire Fraud in Real Estate

author

Jolynne Ash

Buyer's Agent

Berkshire Hathaway Northwest
Cell: 503-804-1608
Email: jolynne@portlandmyway.com Licensed in the State of Oregon

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graphic of email fraud

There was a significant surge in attempted email wire fraud globally in the last few years with a focus on real estate transaction because of the high dollar value wire transfers.

Fraud attempts have successfully collected $5.3 billion through email schemes in the last few years. This figure shows a sharp increase in fraudulent attempts according to the FBI.

In the real estate industry, what happens most often is that the email address of the Buyer, Realtor or Escrow Officer is compromised.  The would-be thief then monitors the email communication between the parties waiting until just before closing.  On the day of closing, the Thief would send an email to the Buyer with a last minute update to the wiring instructions.  These emails look real because they have copied the email signatures of the escrow officer or Realtor and use a ‘from’ email address that is very similar to the real person.  The unsuspecting Buyer makes the wire transfer change, and the funds are wired into the Thief’s bank account rather than the escrow account.  Most home purchase wire transfers are for several hundred thousand dollars.

In most cases, the weak link is the Buyers email.  Real Estate companies like Berkshire Hathaway use email servers and do not allow Brokers to use Gmail, Hotmail or any other ‘free’ service during their business transactions.  Not all Realtors are using servers.  Escrow Officers are all on secure servers or use secure portals with no exceptions.  Buyers are often safer using their work email when transacting large purchases because corporate emails are more secure.  Any email is subject to be hacked.  If you forward a secure email to your spouses Gmail, everyone on the email chain is open to exposure.

As of January 2019, there have been two successful fraud cases involving real estate in the Portland Area.  In both cases, it would have been hard to recognize.  We are now encouraging clients to go back to using cashiers checks and shy away from wire-transfers all together.  It is also a very good idea to call your escrow officer prior to wiring any monies to confirm that you have accurate information.

author

Jolynne Ash

BUYER'S AGENT

Berkshire Hathaway Northwest
Cell: 503-804-1608
Email: Jolynne@@DreamStreetRE.com
Licensed In The State Of Oregon