FBI: This real estate scam is more common than ransomware attacks
Posted November 18, 2021 3:40 p.m. EST
Updated November 19, 2021 4:17 p.m. EST
As commonplace and scary as ransomware attacks are becoming, the FBI says there's an even more common scam to be wary of: real estate scams.
In the last year alone, the FBI says these scams have cost people $1.8 billion dollars.
One local family lost nearly $50,000 by wiring it to scammers pretending to be his title company. They were so convincing, they even had paperwork and information – details Brendan Henkel assumed only his title company would have.
The Henkel family was about to purchase a new home. Their offer was accepted, and they were working on closing the deal when Brendan Henkel was asked to wire funds.
He had emailed his legitimate title company that morning, but somehow, a scammer hijacked the exchange, sending 23 back-and-forth emails. One even included a note of congratulations. The emails also included the legitimate name and signature from his title company contact.
"They sent me the amount that I was supposed to send, and they sent me wiring instructions," said Henkel. "They also sent me my actual closing disclosures that the title company had in their possession."
That disclosure detailed everything from his loan amount to his interest rate.
"$49,400 dollars was the amount we needed for cash to close," said Henkel.
So he wired $49,400 dollars, as requested.
"I got in the car and I was like, you know what, let me just call the title company, let them know I sent the money, see if they got it," said Henkel.
The title company had not received it.
"I felt like someone like snatched my air, like I couldn’t breathe," he said.
Henkel went back to the bank.
"I was begging them. I was like, please do anything that you can to get my money back," he said.
The money was gone.
The secret service, who is now involved, told Henkel that 10 minutes after the wire was received, it was sent to nine different other accounts all over.
"And it was gone at that point," said Henkel.
The scam is called Business Email Compromise or B E C.
The FBI says scammers often gain access to email using malware, then monitor exchanges until it’s time to strike. They trick victims into thinking it’s a legitimate exchange, and often get money transferred to their accounts.
"We had no idea that this was as common as it was," said Henkel.
Signs you might be dealing with a scam
Henkel wants others to look for signs he missed in those emails, in his eagerness to close.
- Grammatical errors dismissed as typos
- A repeated urgency to send the money
- A sudden change in wiring instructions
- Title agent's name in signature, but different email address
Henkel also feels real estate agents, attorneys, and title companies need to do more to alert customers.
"I think it should be at the beginning of the process, in the middle of the process and at the end of the process," he said. "Send that out as a warning to people like this is so common, you need to be careful of this so this doesn’t happen to you."
North Carolina’s Real Estate Commission warns about fraud in the closing template, but it’s deep in a lengthy document that’s part of a process that typically involves customers signing pages they seldom read.
The Henkels have started a GoFundMe to recoup that money and try and keep their home.