It doesn’t matter if you’re selling your fifth home or buying your first—taking the plunge into the world of real estate is always an exciting event. However, there are a few scams you might want to know about before you head to your closing. Wire fraud is one of the worst crimes out there, and many buyers and sellers fall prey to scammers each year. Here’s everything you need to know to stay protected.
What Is Wire Fraud?
Not familiar with wire fraud? Don’t worry—you’re not alone. In the world of real estate, wire fraud happens when a scammer hacks into the email of someone you trust (like your agent or attorney) and sends an official-looking message with new wiring instructions.
Falling for these fake messages can have devastating consequences, especially for buyers. And more often than not, it’s hard to know that you’ve been a victim of wire fraud until it’s too late. Because wire transfers are often irreversible, you probably won’t be able to get your money back, either.
How Common Is Wire Fraud?
If your alarm bells are going off right now, there’s no need to panic. Although wire fraud is rare, it’s a real crime that’s happening all across the world—and the numbers are growing.
According to the Federal Bureau of Investigation, losses related to wire fraud have topped over $12 billion—and $150 million alone was stolen specifically from real estate transactions. In less than two years, businesses and consumers also reported a 136% increase in losses due to cyber-related crimes. While these numbers may seem scary, it’s important to note that only 11,300 people actually lost money to wire fraud in 2018.
What Are Some Red Flags?
Although we’d all like to think we wouldn’t fall for a spammy email, fraudsters have some pretty convincing tactics to confuse even the most informed consumers. However, there are a few red flags you can look out for if you do get a confusing message in your inbox.
If you receive a request for a sudden wiring change that differs from what your trusted individual told you, it’s always best to call them directly for verbal confirmation. Scammers will often include a new routing number and avoid further contact to create a false sense of urgency. Be sure to double check their email address (not just their display name!) and go with your gut. There’s no such thing as being too careful when your life savings is on the line!
How Can I Prevent Wire Fraud?
Aside from being vigilant, the best way to prevent wire fraud is to ask plenty of questions and communicate via phone during the closing process. Nowadays, many documents are e-signed for convenience—but if you prefer the security of signing something in person, be sure to tell your agent.
Want to add another precaution? You may want to consider calling your bank and requesting a verbal checkpoint before they conduct a wire transfer from your account. That way, you can contact your agent before taking action to verify any instructions.
Ready to Make a Move?
Wire fraud might seem pretty daunting, but when you work with the right agent, you won’t have to worry about a thing. I’m Audrey June-Forshey, your Maryland real estate expert. I’ll help you through every step of the buying process, all while keeping your information safe. Just reach out to me with any questions—I can’t wait to exceed your expectations!