This regularly-scheduled sponsored Q&A column is written by Will Wiard, Arlington-based real estate broker, voted one of Washington’s Best Realtors of 2015 by Washingtonian. Please submit your questions via email.
Q: I’ve heard of a few real estate wiring scams going around. What do you know about them? Any tips to avoid them?
A: It’s true. There are several wiring scams out there that could affect a real estate transaction, and all involved in the transaction need to be aware. The most common issue recently seems to be the hacking of email accounts to change the wiring instructions and intercept the release of funds. One way this can happen is by clicking a link sent via email giving a hacker access. It’s important to verify the sender before clicking or downloading anything sent to you.
Whether you are a buyer or a seller, when closing on a home in Virginia you have the option to have the funds mailed as a check instead of a wire. If you choose a wire, be wary of any emails that request a change in the wiring instructions and make sure the title company has the correct account information before they release the funds.
Here are a few examples of recent scams:
Hacking of an agent’s account
A scam that is all too common is when someone hacks into an agent’s email account and sends emails pretending to be the agent. Title companies have seen hackers send emails to clients instructing the client to wire funds for a transaction to a specific account, purporting to be either the agent’s account or settlement company account. For agents, it’s best to warn clients not to alter any wiring instructions without confirming an email with a follow-up telephone call.
Fake email from the seller
Another variation on this is a hacker spoofing a seller’s email address and sending an email requesting that the sale proceeds be wired to a different account than that requested at settlement. Having investigated the situation at two offices recently, a local title company found that the hackers gained access through the seller’s email accounts and obtained information about the sale by reading the seller’s emails.
Many title companies operate under a policy that prohibits the distribution of funds anywhere other than where they were instructed at settlement by a signed proceeds authorization. If the seller wants to change the account, they are required to have a new signed and notarized proceeds authorization for the seller’s protection.
The key takeaway
Regardless of the scam, it’s always best to confirm any changes in wiring instructions received via email with a phone call or in person. Once a wire goes out and the funds are transferred it can be very difficult, if not impossible, to retrieve the funds.
I’m hoping some readers can share any additional advice they have in comments below.
Thank you for this week’s question. Please keep them coming to [email protected]. This is also a great place to reach me for anyone looking to buy or sell a home in the Arlington area.
The views and opinions expressed in the column are those of the author and do not necessarily reflect the views of ARLnow.com.