by Jim Palmer Jr. - Real Estate Marketplace N.W. Inc.
Several years ago thieves figured out a way to scam the real estate buying public. This type of thievery is way different than a petty thief who grabs a few items out of your back yard or garage. These thieves are successful all over the state of Washington each week in scamming hundreds of thousands of dollars from real estate buyers. This problem is becoming an epidemic! I know of a recent case in Spokane where the buyer lost over $300,000 dollars with no recourse. Ouch! Not only did they lose their money, but they lost out on the property as well.
Here is how the basic scam works; The crook hacks into real estate broker email accounts and then monitors their emails for long enough to figure out that they have a transaction in the works. They easily figure out who all the players are; the buyer, the broker and the closing agent. When they figure out that the transaction is getting close to the end, they pose as the broker or the closing agent and send wiring instructions to the buyer using a similar or identical email address, asking them to immediately wire funds to a certain account. They make up some phony excuse that they are out of town and cannot call on the phone, and indicate urgency to the buyer that they must do this quickly. They never call on the phone but do all of their communication online. Once the buyer trustingly wires those funds, they are gone forever! This type of thief is very difficult to catch because they literally could be sitting on their couch in India.
Here are three simple steps to follow so that this will never happen to you! 1) The closer will always deliver a “hard” copy of wiring instructions to you. If you ever get wiring instruction via email, do not respond. 2) Your broker will give you the phone number for the escrow or closing agent so that you always have a trusted contact. 3) Before you wire a large sum of money, send a “test wire” of $100 first; then call the known trusted phone number of the escrow agent to verify receipt. If successful, send the balance.
This scam is an enormous risk to consumers because it is so devious and because the crook can get away with a whole life savings in one quick scam.