A fraudster doesn’t need to be successful most of the time. They don’t even have to be particularly lucky. They rely on the mistakes of their victims, but even then, they don’t need those mistakes to be major. They simply need one or two small errors to stack on top of each other. From there it’s all about timing.
Allow me to explain and give an example. One growing target for fraudsters is wire fraud—specifically—targeting real estate transactions. There are a few unique things about real estate transactions that make them attractive to fraudsters.
Moving Funds
First, they know money is about to be moved. If the money remains safely in your account, it’s harder for them to get to. They rely on intercepting those funds in transit. You intend to send funds from Point A to Point B to facilitate your real estate transaction.
Multiple Parties
More parties to a transaction mean more potential targets to intercept funds. This is often done through phishing. Phishing is a common fraud technique in which the fraudster pretends to be a known, trusted person, or credible entity and emails the victim to acquire sensitive data. This can be as simple as a name or address but can sometimes include passwords or bank account information.
Once a victim’s email is compromised, the fraudster can often access additional sensitive information, or leverage that compromised email to solicit another victim. This can often occur without the victim(s) even becoming aware.
Timing
More parties in a transaction means more variables. More variables mean more complexity. Fraudsters love to exploit complexity because it makes it easy for them to hide, wait, and catch you off guard, distracted, or in a hurry. Timing is everything.
Using bits of information gained from phishing attacks, the fraudster can intercept and redirect emails to create urgency. Because timing is always critical in real estate transactions, a fraudster will often attempt to exploit this. Last-minute changes to bank account information or wire instructions should be major red flags.
Prevention
What can you do to protect yourself from wire fraud on your real estate transaction?
- Know the transaction process and payment options for closing funds.
- Be skeptical when receiving new instructions.
- Verify potentially suspicious emails through a callback process, especially for sensitive information to fund transfers. Never call back on a number provided by the suspicious email.
Always independently verify. This means using a phone number from a trusted, known source to verify what you are being told. Never trust an inbound call, even if the caller ID matches the intended recipient.
Tidal Money
Tidal Money is focused on creating secure and efficient transactions. Using Tidal Money’s platform, realtors, buyers, sellers, escrow teams, and transaction coordinators can request and send money quickly and securely. Seamlessly integrating with your system of record, Tidal Money provides peace of mine and streamlines the experience for users to pay how they want, when they want.
Secure transactions are what we do best. Partner with Tidal Money for secure money movement and ease-of-use.
