Don't Be a Victim of Wire Fraud: Protect Yourself

Wire fraud is nothing new in the mortgage industry but hackers are getting more and more intelligent with improved ways to identify personal information. At Churchill Mortgage, we take the privacy and security of personal data very seriously. We want to share ways in which you can also be diligent to personally protect your data as well.

Virtually anyone can be a victim to fraudulent crimes if their personal information is not protected. Take a few minutes to educate yourself about the risks with phishing scams during your homebuying process and what you can do to take extra safety precautions to protect your information.

How does a scammer get personal information about you?

Usually these scams start out with a digital point of entry, like your personal email account or through your real estate professional’s email. This is where the scammer will locate personal information about upcoming transactions such as the closing date of the home you’re about to purchase and other details to assist with financial fraud, email spoofing, and online identity theft. Hackers have been known to watch email chains for weeks, waiting for the right opportunity to put the scam in action.

Once this personal information has been breached, you may receive an email that looks very close to that of one from your actual loan officer, real estate agent, or even your title company with instructions on how to transfer closing costs to a different account than what was originally planned. Oftentimes, this email will be sent very close to the closing date and homebuyers panic that their closing will be delayed if they do not quickly send over their bank information.

The hacker will usually mention there was a last-minute change to the original money wiring instructions due to an error on the bank’s part, or will blame another third-party. If the homebuyer follows through with the wire transfer, their bank account can be cleared out in just a few short minutes.

Here’s a few quick tips to help you avoid a wire fraud scam when purchasing a new home:

• Use an encrypted file transfer service that requires a log in and password to send all your financial and personal information if it needs to be sent digitally. Sensitive information should never be sent over unsecure email.

•  Always pay attention to the full website names and email addresses that you’re working with. Criminals will often try and trick you by sending something that looks like it’s coming from a mortgage company, a bank, or even a person you trust (like your real estate agent). Keep in mind, it could be just one letter off from the original website or address, or have a logo that’s been only slightly changed.

• Never wire funds without first calling the intended recipient. Confirm all wire transfer information over the phone with someone you trust or your designated contact. Some hackers have listed a phone number in their email to homebuyers. Do not use that number. Be sure to reach out to your recipient directly with the phone number you were originally given.

• Hover over links and email addresses with your cursor. This will help you see the actual URLs and further verify the intended domain names that are associated with the links and emails.

What should you look for from a lender to help ensure your information is secure through your loan process?

• Work with a lender that uses a third-party verification service instead of one that is verifying on their own accord.

• All wiring information for title companies should always be verified from a third party such as Secure Settlement. If new wiring instructions are added to this system, it allows your lender to quickly verify and easily compare the new instructions to what is already on file. If there is a change, the lender will be able to work with the third party to vet those changes and make sure they are legitimate.

• Ask your lender what safeguards they are taking to protect your personal information from an internal perspective as well. Lenders should have secure portals, servers, and databases to protect information from being breached by hackers. Read your lender’s privacy policy and ask how your information will be shared.

If you become a victim of wire fraud:

Time is extremely important in these cases of wire fraud so remember to alert the authorities as soon as possible. Fraud crimes can take place at both the state and federal levels. If you think you’ve been a victim of a cybercrime quickly report it to your bank and local law enforcement first. Be sure to save all emails and paperwork relating to the crime to provide documentation of financial losses.

Churchill Mortgage believes that one of the best ways to protect borrowers is to educate them. We hope these suggestions are helpful and give you a quick reference of what to do if there is ever a breach in your data security.