Phishing is the fraudulent attempt to obtain sensitive information such as usernames, passwords, and credit card details, often for malicious reasons, by disguising as a trustworthy entity in an electronic communication. From 2015 to 2017, the FBI reports a 110 percent rise in the number of such scams involving note and real estate transactions.
How do you keep you and your transactions safe? The FBI offers some of the following suggestions through its public service announcement warning businesses:
Verify all requests of a change in payment type and location. Scammers often request that payments that are originally scheduled for check deposit be made via wire instead. Also, they request changes to the original recipient’s financial information. Real estate professionals and their clients should verify with their main contacts whenever they receive information via email that is involving financial changes or financial solicitations.
Be wary of communication that is exclusively over email. Scammers will take public information available on real estate listing sites and use it to then target victims. They may see listings that are “under contract” and then use the contact information of the real estate agent to insert themselves into the transaction, posing as the agent. “Be wary of any communication that is exclusively email based and establish a secondary means of communication for verification purposes,” the FBI writes. Also, don’t always assume a website that uses the padlock security icon—containing “https” in the URL—is safe. Scammers are increasingly using the icon on their sites, so it is not a foolproof indicator.
Set a code phrase with main contacts. Victims have reported also receiving phone calls from scammers requesting personal information for verification purposes. To verify the person is correct, encourage clients to establish code phrases that could be used to verify two legitimate parties, such as client to real estate agent or financial institution to client.
Act quickly if you think you’ve been scammed. Time is critical. Contact the financial institution first and request a recall of funds. Then, contact your local FBI office and report the fraudulent transfer. File a complaint at www.ic3.gov or bec.ic3.gov. The IC3 will assist the financial institutions and law enforcement in the recovery efforts of the funds.
Watch this video created by NAR’s legal team for more tips on how to avoid wire fraud in transactions.