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Best Practices

Thieves Steal Earnest Money Through Email Fraud Scheme

May 1, 2014

Title agents should be aware of a new email fraud scheme where hackers are targeting consumers and stealing earnest money for upcoming transactions.

According to underwriter alerts to agents, borrowers have received emails allegedly from a title agency providing wire information to transmit earnest money for the transaction.

In this scheme, the fraudsters intercept emails from title agencies providing wire transfer information for borrowers to transmit earnest money for an upcoming transaction. The scammers then alter the title company’s bank account information with their own. The unsuspecting borrower wires their down payment directly to the fraudsters. The emails appear to be genuine and contain the title agency’s email information and/or logos and branding. This scam is similar to the email hacking scheme perpetrated against real estate agents earlier this year.

In these scams, the hackers monitor email traffic of the title agency or customer and gain knowledge of the timing of the upcoming transaction. While these scams target earnest money, an altered email could conceivably be used to cause misdirection of funds by any party in the transaction, including the title agent themselves.

The attacks illustrate the importance of using encrypted email to send private information, including account numbers.

For more on email encryption, see Title Company Finds Effective Email Encryption Solution or view the webinar Best Practices: Tackling the Challenge of Email Encryption.



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