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Getting ready for your home closing? Make sure you know where that email on where to send the money is coming from.


By Harvey S. Jacobs

As if buying, selling or refinancing your home were not stressful enough, consumers must now be aware of an increasingly insidious form of email-based real estate fraud. The FBI categorizes this crime as Business Email Compromise (BEC). In 2018, it is estimated that 11,300 consumers lost$150 million to BEC crimes.

BEC crimes begin when scammers induce email recipients to open or click on a link in an infected email.

When the recipient inadvertently opens or clicks on the fake email, a malware program is installed on the recipient’s computer. Once that malware embeds itself, it allows the scammer to monitor the recipient’s emails for words like “settlement date,” “wire instructions” or “cashier’s checks.”

At just the appropriate time, the scammer, impersonating the title company, will send out a fake email instructing the victim to wire funds to a bank account that turns out to be the scammer’s own account. Thinking it has received official title company wire instructions, the victim willingly wires their funds.

There are numerous techniques scammers use to get real estate settlement parties to click on fake emails.

One technique is to spoof the legitimate sender’s email address. Scammers send fake emails from accounts that are nearly identical to the legitimate sender’s email addresses. For example, law firm email addresses that contain the word “law” are spoofed when scammers change the word law to lavv. On a mobile device, distinguishing a “w” from a “vv” can be almost impossible.

Another technique uses social engineering by appealing to the recipient’s sense of urgency, fear or curiosity.

Scammers send massive numbers of malware-embedded emails containing real estate settlement subject lines such as: “URGENT There is a problem with your settlement.” Innocent home buyers fear something may have gone awry with their settlement and open and/or click on the infected email.

From that point forward, the scammer can access all transaction details. These emails are referred to as “phishing” emails since they are designed to hook their recipients into clicking on a link in those emails or even just opening them.

Increasingly, scammers are targeting specific recipients by taking advantage of all the publicly available information about a real estate transaction. They “phish” the listing agent, and if successful, they gain access to that agent’s email.

With that access, the scammer obtains information such as the names and email addresses for buyer, seller settlement company and lender as well as the loan amount and the proposed settlement date.

Armed with this data, scammers pose as the settlement company and email the buyer well before the settlement date and falsely instruct them to wire their “cash to close” immediately. Unwitting buyers comply. It is only later, when the real settlement company contacts the buyer, that the horrible truth is discovered. By then, it is too late for law enforcement to trace the funds or catch the scammers.

“Scammers send us phishing emails every day, and sometimes numerous times in a day,” said John Cotter, president and CEO of Passport Title Services in Rockville, Md. “It is imperative that before consumers wire settlement funds, they scrutinize the sender’s email address. We no longer accept wiring instructions via email unless verified by a phone call.”

With this much at risk, the real estate industry has embarked on a public education campaign to raise awareness of these crimes. The American Land Title Association (ALTA) launched the Coalition to Stop Real Estate Wire Fraud with consumer resources at

If you do become a victim of BEC crime, “immediately call your bank and ask them to issue a recall notice for your wire, report the crime to and call your regional FBI office and police department,” said Justin B. Ailes, senior vice president of policy at ALTA. “When these steps are followed within 24 hours of the wire transfer, the FBI’s Internet Crime Complaint Center’s Recovery Asset Team has recovered 75 percent of compromised funds.

To avoid being victimized, the public should carefully examine the sender’s email address to confirm it is coming from a legitimate sender. If in doubt, do not reply; rather, forward the email back to the known email address.

Do not use phrases like “wire instructions” in the subject line of your emails. Call and confirm all wire transfer instructions by phone using a previously known phone number or by accessing the title company’s website.

Do not call the phone number in the suspicious email. Minimize the number of people who get copied on real estate settlement-related transactions by sending transaction details only to those on a need-to-know basis.

Start a new email thread each time you email anyone involved in the transaction, especially when communicating about the financial part of the transaction.



Harvey S. Jacobs is a real estate lawyer with Jacobs & Associates in Washington. He is an active real estate investor, landlord, settlement attorney and lender. This column is not legal advice and should not be acted upon without obtaining your own legal counsel.