There have been so many advances in technology in all the years I have been working in real estate, and most of them have changed the industry for the better. But in recent years, one rather sinister cyber-activity has begun to plague realtors and their brokers – wire fraud. Every day, more and more people are receiving phishing emails with the sole purpose of trying to glean personal financial information.
Unfortunately, real estate transactions are a perfect target for cyber criminals looking to commit wire fraud. They need only to hack an agent’s email to find pertinent information on potential closings at which funds will be required to be wired to a title company. Once they succeed in gathering the information they need, they clone the email address of either the real estate agent or title officer, then send false information to clients with fake wiring instructions, directing the client to transfer funds into accounts owned by the criminal. And sadly, their scheme often works.
There have been a multitude of such cases where buyers have been coerced to send hundreds of thousands of dollars to fake accounts set up by the hackers. This happens all over the country and has even happened here in The Woodlands.
The FBI recently released their report of Cyber Crime in the US for 2018. The total for Real Estate/Rental alone was $149,458,114. There were billions in total of all the different losses to Cyber Crime, with Texas ranking second in a tie with Florida, and both behind California as number one for the most victims.
So, what steps can we take as realtors to protect our clients? There are services that will intercept emails and protect with encrypted access, but this can become incredibly costly to protect every agent’s devices, particularly considering that most agents now use multiple devices in their work like a laptop, phone, office computer, and Ipad.
At Beth Ferester & Company, we have ongoing safeguards including multiple red-lined warnings on every email we send out to clients and other agents warning of wire fraud. We have a form that clients sign warning them separately of these crimes, and we remind the agents constantly to talk to each client about this unfortunate threat. Keeping our company small is a great benefit as it allows us to work as a tight-knight team to prevent this from happening to our clients, but we must constantly be on guard and prepared to take multiple steps in order to protect those we serve.
Please be aware of this threat in all aspects of life and in everything you do. We will delve into ways of protecting your personal identity and financial transactions in our blog on June 11th – watch for it!