I have been reporting to you about this particular scam preying upon home buyers for eight years, however this scam has gotten worse in recent years.  Five years ago, the Consumer Financial Protection Bureau (CFPB) issued a warning about the scam and its dramatic increase.   The scam targets people involved in the purchase and sales of residential real estate. The scam begins with the hacking into the email accounts of any of the various people involved in the sale.  This can be either the buyer, seller, lawyers, title company, real estate agent or  mortgage banker.  Unfortunately, hacking into email accounts is a relatively easy thing for a skilled identity thief to do.  The hackers then monitor the communications regarding the progress of the sale of a particular piece of real estate and when the time is right,  generally posing as one of the lawyers, title company or bank mortgage officer, the scammer will email the buyer, telling him or her that funds necessary to complete the sale need to be wired to the phony lawyer’s, title company’s or banker’s account provided in the email.  Everything appears normal so unsuspecting buyers too often are wiring the money to the cyberthieves who then launder the money by moving the funds from account to account to make it difficult to trace the funds.

In one instance last year in Colorado Phil Tamchina thought he was responding to his real estate agent who requested ten days before the scheduled closing that he wire the $730,000 for the purchase of his new home to the real estate agent.  He did so, but the email didn’t come from his real estate agent, but came from a scammer.  Fortunately, the bank where the funds were sent had put a hold on the account after red flags were raised and the funds were able to be sent back to Mr. Tamchina.  Many other victims of this scam, however, haven’t been as lucky.

TIPS

Whenever you are asked through an email or text message to wire funds as a part of a real estate or other business transaction, don’t do so until you have confirmed that the request and the account to which you are being asked to wire the funds are legitimate.  Appearances can be deceiving so always confirm.  It may seem a bit paranoid, but remember, even paranoids have enemies.

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