A new variant of wire fraud schemes is increasingly targeting homebuyers.
Buyers are tricked into wiring their downpayment on the day of closing to a fraudulent offshore account, often by criminals who have spoofed or co-opted their real estate professional’s email account.
Losses from these scams are typically not covered or reimbursed by the bank. Since the wires go overseas, it’s nearly impossible for victims to recover their money.
Victims have lost six-figure sums and had to cancel transactions on their dream homes due to this fraud.
It’s a nightmare scenario for any homebuyer: the day before closing, a scammer manages to trick you into wiring your down payment to an offshore account. You lose your hard-earned money and you lose the house, and there’s no way you can get either one back.
That’s how some criminals have adapted the common “business email compromise” scam – so-named because it used to almost exclusively target businesses – to focus on individuals, especially people who are involved in a pending real estate transaction.
Here’s how it often works: a person involved in a real estate transaction, such as a real estate attorney or realtor, has his or her email account compromised by malicious software, known as malware, sent by a criminal over email. Unbeknownst to the professional, the fraudster can now monitor the realtor’s emails to look for upcoming transactions.
Next, just as a closing date is coming near, the fraudster uses the compromised email account to send a legitimate-looking message to the buyer – which, coming directly from the realtor or attorney’s account, appears real. The note tells the buyer that there’s been a change of plans, and he or she needs to wire the down payment just before the closing date, supposedly to a bank account belonging to the seller.
But the account actually belongs to the criminal, and is typically overseas, out of the reach of U.S. law enforcement, Kalember said.
read more at: https://www.cnbc.com/2018/08/31/how-scammers-trick-new-homebuyers-with-wire-fraud.html
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