My company closes hundreds of transactions a year and we have never experienced a wire fraud incident. However, a conversation with one of my title company reps offered a real life horror story and got me thinking a little more carefully about it.
In May 2015, NAR issued a warning about wire fraud to its members.
Criminals are hacking into agent and escrow officer’s email accounts and posing as an employee of the title company or you instructing the buyer/seller to wire funds into a different escrow account. Once this money is sent, it’s difficult to locate it. Worse, the hackers insert a phone number to call them to verify the wire information is legit! Note that free email like Yahoo and Gmail and easiest to hack.
There is also the question of who is responsible when this happens…The agent because their email was hacked or the escrow company because they sent sensitive information to the agent?
To avoid this situation, some title companies are now using secured emails (require a username and password) to send out sensitive information to team members. This usually includes wiring instructions, estimated and final settlement statements and even deposit receipts which may include escrow numbers, escrow officer information and buyer’s names.
There are now wire fraud disclosures incorporated into many of the local and statewide disclosures.
Best practices is to alert your client when escrow is first opened to be careful with wire transfers. They should ONLY call the escrow officer that was initially assigned to the transaction to confirm the instructions prior to wiring.
Let them know that delivering a cashier’s check to the title office is the safest method of assuring the money gets into the right hands.
Do not forward sensitive information to other team members.
Finally, consider switching your free email account to a more secured domain to reduce potential hacks.