Buyer beware: In hot housing market, scam targets real estate closings
Posted May 5, 2016
Updated May 6, 2016
Raleigh, N.C. — With home prices rising and inventory low, the housing market in the Triangle is more competitive than ever, putting pressure on buyers to move quickly when they find a home they want.
The need for speed adds an extra layer of pressure to an already pressure-packed process, something scammers are relying on as they try to steal thousands of dollars.
The North Carolina Real Estate Commission and the state Attorney General's Office have both issued alerts about a new scam, saying it targets everyone involved in the process – buyers, sellers, agents and attorneys.
The scam can take a number of different forms, and in one common example, hackers break into a broker's email to gather information about a possible transaction.
A clone email address is created, and as the closing date nears, scammers will send an email to the buyer, purportedly from the broker, with new wiring instructions.
Experts say sellers and buyers should not send sensitive transaction information via email. Experts also say that email accounts should be cleaned out frequently. Important notes should be saved to hard drives.
Immediately before a wire transfer, confirm the details with the recipient, in person if possible, experts say.
Real estate attorneys across the state began reporting the scam last year.
"It's amazing. They make it look so easy," Mark Parker, the president of the Raleigh Regional Association of Realtors, said. "It could happen to anyone. It's scary when someone can go in there and pretend to be you."
Parker learned about the scam firsthand when his email address was hacked, cloned and then used by a scammer.
In Parker's case, the scammers sent a fake email to one of his colleagues requesting the transfer.
"It looked just as if I had sent the email. Luckily, he caught it," Parker said.
Janet Thoren, a lawyer for the North Carolina Real Estate Commission, said scammers are constantly looking for vulnerable parties.
"If they're successful, they're able to get the proceeds wired to a different account that they have control over, and at that point, the proceeds are gone," Thoren said.
Stacye Horowitz, a broker with Fonville Morisey, says she's among a growing number of brokers who are using new safeguards to protect herself and her clients.
"(Consumers) have to be concerned because there are people that are hacking into emails when they see something that says wiring and intercepting them, and the money is going to the wrong place," Horowitz said.