RENT Magazine Q2 '23

HOMEBUYER FRAUD IS SKYROCKETING The amount of home buyer fraud alone has skyrocketed lately; according to the FBI’s IC3 office, 9,645 prospective home buyers lost nearly $1 billion in 2017 alone due to wire fraud situations and that number is way up from the mere $19 million lost just a year prior. In other words, about $2.65 million in real estate funds were stolen from home buyers every day. And the FBI reports that email compromise scams like this are a $12 billion (and growing) industry. Any time you plan to make a major purchase with high dollar figures involved, you run the risk of encountering a scammer who wants to hijack your dreams. A woman in San Jose—who chose to remain anonymous in the fallout of her loss—approached retirement and was looking to downsize. She found a home that met her needs and agreed to put $400,000 down on the new house. But when it came time to send the down payment, she received emails from a scammer that appeared to have come from both the real estate agent and the title company. The messages said that the seller had changed the purchase agreement and instructed her to wire all the money rather than getting a cashier’s check. She did as she was told and realized, just two hours later, that the money she’d spent ten years accumulating had vanished. Even that loss is small compared to the $1.57 million lost by a Washington, D.C., couple whose transfer of settlement funds was diverted to a hacker’s own account when the thief broke into the title and escrow company’s email system. Hackers are finding openings in title companies’ or realtors’ email accounts to track upcoming purchases that are scheduled to close—the higher the price, the better—and then appear to be those trusted sources to provide fraudulent wiring instructions that the recipient will believe. Then the funds go directly to the scammer’s own bank account, which is promptly emptied and closed, then gone without a trace. Shouldn’t the government actively pursue such criminals?



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