Sarasota Real Estate News

Yesterday I attended a Sarasota real estate agent round-table session hosted by one of our local real estate attorneys. 

She discussed avoiding a cyber fraud event within minutes of a wire transfer. A week before closing, a buyer received new wiring instructions and wired close to $1 million to a bank account set up by Mr. Hacker. 

How did this happen? First, this hacker accessed the buyers' Realtor's email account and the details of this home purchase. Mr. Hacker then installed a filter to reroute all future emails to his account.  

There were no red flags for anyone. Mr. Hacker responded to all emails as if he were the Realtor or the buyer's attorney. 

Mr. Hacker gave the buyer new wiring instructions for the balance of funds owed at closing. Close to $1 million. 

Fortunately, this closing attorney figured out something was wrong and because of her relationship with a local bank, the wire transfer to Mr. Hacker didn't happen.

This is why it's important for all of us to change our email passwords frequently. For Realtors, we should perhaps change our passwords each time we have a new transaction. Most of our Realtor insurance policies do not cover wire/cyber fraud, so Realtors: call your insurance company today!

Realtors can increase our own personal liability insurance for cyber fraud. Law firms are capped at $250,000 coverage, and some up to $500,000. 

In litigation that the buyer WILL likely file against the Realtor, that agent will have to show what they did to prevent this. Have standard policies/procedures in a Word document. National Association of Realtors (NAR) has a statement Realtors should have at the end of emails. Add that statement to emails going out when using mobile phones.

Cell phone wire fraud. Think about turning off WI-FI when you are out running errands.

Change your password monthly.

Keep your computer anti-virus updated. The court will confiscate the computer and see if you have the software installed.

Prepare Buyers - this is an industry problem! And remind them throughout the transaction, too.

Stay in touch with Buyers and see if they received different wiring instructions than they received from the time they wired their deposit initially. 

Where clients go wrong: They call the number given by Mr. Hacker for the new wiring instructions, he picks up the phone and answers as if he's the law firm. 

Buyers: call Realtors before sending a wire!

Buyers/Sellers: scrutinize email addresses of incoming emails.

Buyers: SAVE wiring instructions from sending initial deposit. It won't change. If in doubt, call telephone number of closing agent on page 1 of the contract.

This is happening because Mr. Hacker is controlling all communication the last 10 days before the transaction closes.

Another buyer received an invoice from a home inspection company for $2,500. It was fraudulent. 

Remember that with AI, all answers make sense today when working with foreign hackers.

Thank you for reading my blog. Call Linda Holley, Sarasota Realtor, GRI, SRES, CIPS, Fine Properties, 941-914-4914, for your questions in real estate for Sarasota County and Manatee Counties.