Buyers continue to lose home-purchase money to wire fraud. They need to understand the problem, and have access to the tools and resources that can help keep them safe.
WASHINGTON – October is National Cyber Security Awareness Month. The Real Estate Fraud Prevention Coalition is working with its partners in federal, state and local government to elevate public understanding of cybersecurity risks and give consumers the tools and resources they to stay safe online. This year’s theme is “Do Your Part. #BeCyberSmart.”
“Wire fraud is one of the fastest-growing cybercrimes in the U.S., and consumers need to understand the risks that exist within every real estate transaction,” says National Association of Realtors® (NAR) President Vince Malta. “As Realtors, we have a critical role to play in educating and protecting both home buyers and sellers – and NAR is exploring every possible opportunity to defend against cybercrimes targeting American citizens.”
As part of the initiative, the Real Estate Fraud Prevention Coalition prepared resources to help consumers protect their data and sensitive information, especially when buying a home. The Coalition’s list of tips and tools to help reduce cyber incidents can also be found at each participating association’s website.
“Members of the American Escrow Association handle your personal information and dollars through safe and secure communications and financial systems,” says Carlye Buxton, president of the American Escrow Association. “Please always remember: Whenever you send money or personal information by electronic means to your settlement agent, be sure to verify with your point of contact at the company that the destination is really your settlement agent.”
The FBI’s Internet Crime Complaint Center received 467,361 complaints in 2019 – an average of nearly 1,300 per day – and recorded more than $3.5 billion in total losses. Additionally, COVID-19 has created new global cybersecurity threats, with the number of registered fraudulent emails and text messages spiking nearly 700% in the early days of the pandemic.
“The title and settlement industry has improved its digital hygiene and implemented many procedures to combat wire fraud,” says Diane Tomb, CEO of the American Land Title Association. But “no matter how much money we spend, criminals will continue to target consumers. This is why we must continue to educate people about how they can protect their money when purchasing a home or refinancing a mortgage.”
Different types of cyber threats pose risks to the real estate industry and its customers, including scams in which criminals posing as real estate or title agents send fraudulent emails instructing homebuyers to initiate wire transfers to illegitimate accounts. These scams, which often appear credible because of the specific, personal content contained in the email, have the potential to defraud homebuyers out of tens of thousands of dollars over the course of a transaction.
“As real estate transactions become increasingly digital, cybercriminals continue to get more and more creative in their efforts,” says Bob Broeksmit, president and CEO of the Mortgage Bankers Association. “It is important that borrowers and the industry remain vigilant, protect their data, and follow best practices in sharing personal and financial information