Cyberfraud targeting potential homeowners is on the rise, and it’s affecting Realtors, real estate brokers, title companies, homebuyers, and sellers across the country at alarming rates.

Real estate cyberfraud often begins when a criminal hacks into an email account and obtains information about an upcoming real estate transaction. Communications between parties are monitored, and the criminal is able to estimate when a closing will occur.

As the closing approaches, the criminal sends fraudulent emails to the buyer, posing as an escrow agent. These emails appear to come from the buyer’s title company, real estate agent, or loan officer. The email often asks them for a down payment or other financial obligation required for closing. The emails include instructions for wiring funds to an overseas account that is controlled by the criminal and out of the jurisdiction of U.S. law enforcement. Some victims have lost entire life savings in these scams.

For criminals, real estate wire fraud is a lucrative undertaking because transactions involve large amounts of money and the criminal receives immediate payout. The use of online banking and electronic real estate contracts have made buyers and sellers vulnerable to being taken in by these schemes.

Tips to protect against cyberfraud:

• Verify the phone number of the agent or title company being used for the transaction with the phone number on the email as well. Never rely on the accuracy of the phone number given in an email requesting money.
• Be on guard. Homebuyers should be aware that they may be a target for scammers and verify any suspicious requests they get.
• Realtors should require buyers and sellers to sign a document alerting them to the problem of real estate cyberfraud as part of their contract.
• Never use email or other forms of online communication to change wire instructions. Be aware that parties in a real estate transaction rarely change wire instructions in the course of the transaction.
• Don’t forward wire instructions to any other parties.
• Avoid using the phone number on the wiring instructions. Use phone numbers you have used before or verify the phone number of your agent.
• Don’t send a return email to verify instructions. The email address may be incorrect or the email may be intercepted by a criminal.
• Avoid free web-based e-mail accounts. Establish a company domain name and use it to establish company e-mail accounts in lieu of free, web-based accounts.
• Be suspicious of requests for secrecy or pressure to take action quickly.
• Delete unsolicited e-mail (spam) from unknown parties. DO NOT open spam e-mail, do not click on links in the e-mail, or open attachments. These often contain malware that will give subjects access to your computer system.
• Carefully scrutinize all e-mail requests for transfers of funds to determine if the requests are out of the ordinary.

According to the Financial Crimes Enforcement Network ,or FinCEN, real estate was the third highest targeted sector in 2018.