As I have written about before, Phishing is one of the oldest forms of Cyber attacks that are out there, but yet, it still is quite surprisingly still one of the most favored forms of threats by the Cyber attacker. For example, there are new variants of it now which are even more devastating than just the usual. A prime example of this is what is known as the Business Email Compromise, or BEC for short.
This is when the Cyber attacker sends an email to a lower ranking employee of a business or corporation (such as administrative assistant) asking for thousands of dollars to be sent over to an overseas account. However, this email is usually disguised as one coming from an immediate supervisor or C-Level Executive that is demanding this request.
Now, this trend appears to be happening now in the real estate market as well. It particularly impacts people where it hurts the most – the moment when the new home buyer is about to make the first down payment before the close. CNBC led a story on this, where they talked to two victims. Both of them lost six figure amounts of money, and one even lost their entire life’s savings.
This type of real estate BEC is growing at a rate of 14X more than even the previous year. In fact, the Federal Bureau of Investigation has also warned several times this year that email compromise schemes are on the huge increase.
So, just exactly how does this scheme work? Well, this typically involves somebody who is close out at hand such as the real estate broker or even the real estate lawyer whom is trying to wrap up this deal. The Cyber attacker then launches specialized malware to this person’s e-mail account, and unbeknownst to the agent or the attorney, the Cyber attacker can now keep a covert eye on the realtor’s emails to look for upcoming transactions.
As the closing date comes even closer, the Cyber attacker uses the compromised email account to send an authentic looking message to the buyer. The message tells the buyer that there has been a sudden change of plans, and because of this, he or she needs to wire the down payment just before the closing date, in a bank account which belongs to the seller.
But as we all know, this is just a phony bank account that is set up by the Cyber attacker, usually in a different country.
Sometimes, the Cyber attacker even goes as far as calling the buyer of the home in order to reassure the victim that the transaction is for real. But now here is the key thing to remember: If you have money stolen out of your bank account for any reason, typically your financial institution will reimburse you for any lost monies. But this is not the case for wire transfers. Once the money is gone, it is gone almost forever.
So far, BEC crimes have involved 115 countries, and are topping well over $12 Billion now. So, what can you do to protect yourself from becoming a victim of this kind of Cyber attack?
*First, as a new home buyer, you need to very vigilant that this type of scheme occurs, and always verify any type or kind of suspicious correspondence that you might get. For example, if you get an E-Mail about any wire transfers, always consult first with your real estate agent or attorney.
*Second, always confirm any transfer request by voice as well. For example, if you get that BEC E-Mail from your attorney or real estate agent, always call them back to confirm to see if they have really sent that message. If they have not, then you know its fraud, and contact the FBI immediately.
*Third, request your bank to have another layer of authentication before the wire transfer actually goes through. Meaning, before it actually starts getting processed, the bank should call you, your attorney, or real estate agent to make sure that the transaction is actually to supposed to transpire.
*Fourth, as stated before, don’t be so quick in responding to E-Mails that are requesting immediate transfers of money, or that there has been a sudden change in plans. Always check first with your realtor or attorney first.
Finally, also keep in mind that Cyber attackers are also very tactfully using Social Engineering when making phone calls to you as well. Keep a close eye on the actual conversation, and if something just doesn’t feel right in your gut, then hang up and yet once again, contact your realtor or attorney.
Unfortunately, the ball is in your court on this one to be proactive, because of the issue of wire transfers. Remember just to be vigilant about anything that is not part of the normal closing process.