HOMEWOOD, Ala. — It's known as the Closing Cost Scam. Home buyers are tricked into sending thousands of dollars to cyberthieves who intercept emails. These scams are up 11,000 percent from 2015 to 2017 in the real estate sector. May of 2018 saw the highest number of victims. Nationwide losses reported at $1.1 billion.
Like everywhere else, Alabama is getting hit according to the FBI. One home buyer lost $250,000. Another case was reported just last week.
"We're making changes way we operate," explains Homewood closing attorney Bill Halbrooks, He says everyone in the industry is on alert and moving to more secure email, faxing when available, and warning buyers.
Halbrooks says one of their clients almost got duped out of $42,000. "We caught that one in time," says Halbrooks.
Here's how it works. Hackers use lax email security to get in by sending phishing emails to the title company or the closing attorney or the home buyer. Then they wait and watch, monitoring those emails. Next they move in around closing time sending the buyer an email with instructions where to wire the money, often to an overseas account.
Serenity Isom and her young family lost $12,000. Just days before closing the loan on their first home, bogus instructions on where to wire the closing money arrived via email.
"[We were finally going] to own our own home and we just fell for this stupid scam," laments Isom.
The FBI is warning consumers to always take that extra step in verifying information received through emailed. Call your realtor directly with their known number. Check with the title company by finding their number online. The number that came in the email may be a fake spoofed number. You may ask if the closing company will take a cashiers check as opposed to wiring the money.
So if you think you've been duped, what's next? Act immediately. Call your bank and the FBI.
The FBI has what's called a "financial fraud kill chain" that can stop the transfer. But the window to even try to get your money back is very slim, about 72 hours.