Denver Buyer Scammed out of $200,000! Did you see this heartbreaking story on March 17th (2023), where a retired teacher and her daughter in Colorado who were getting ready to close on their new home were scammed out of $200,000? They were sitting at the closing table only to find out the title company DID NOT receive their funds for closing. Jaw-dropping and heart-stopping. (IMAGINE!)
“The funds were sent to an account not affiliated with the title company after the email chain was hacked by unknown scammers, she told the Denver-based news station.” (NY Post
Email Compromised
Somehow the chain of emails between parties was hacked, and fraudulent emails were sent to the buyer instead of the Title Company’s closing paperwork; however, no one ever noticed.
The Colorado Bureau of Investigation (CBI) called the scam “business email compromise,” where “scammers will spoof or fake an email account from an interested party in order to get the true bank account changed to one they can control.” (NY Post)
The CBI will work to capture or freeze the funds as fast as possible so they can be returned to the damaged party and strongly suggests never changing your bank accounts when instructed by an email. Always verify with the original parties to confirm via phone call all instructions.
“In 2022 in Colorado, the FBI received 504 complaints of business compromise, costing victims nearly $54 million,” the FBI said in a release obtained by Fox 31 Denver. (NY Post)
Consumer Financing posted this list a few years ago, but it is still good steps to follow today.
(See below)
How to avoid a mortgage phishing scam
- Identify two trusted individuals to confirm the closing process and payment instructions. Ahead of your mortgage closing, discuss in person, or by phone, the closing process and money transfer protocols with these trusted individuals (realtor, settlement agent, etc.). Be cautious about exchanging any details about your closing over email. You may want to use this opportunity to also create a code phrase, known only by these trusted parties, if you need a secure way to confirm their identities in the future.
- Write down their names and contact information. Use the Bureau’s Mortgage Closing Checklist to list these individuals and their primary phone numbers.
- Before wiring money, always confirm instructions with your trusted representatives. Never follow instructions contained in an email. Verify the closing instructions, including the account name and number, with your trusted representatives either in person or by using the phone number you previously agreed to.
- Avoid using phone numbers or links in an email. Again, scammers can closely replicate the email address, phone number and format of an exchange from your agents. Avoid clicking on any links or downloading attachments without first confirming with your trusted representatives.
- Do NOT email financial information. Email is never a secure way to send financial information.
- Be mindful of phone conversations. It may be difficult to identify whether a phone call is fraudulent or legitimate. Scammers may call and ask you to verify your personal or financial information. When in doubt, always refer back to your trusted professionals to confirm whether it’s legitimate.
What to do if it happens to you
- Contact your bank or wire-transfer company immediately. Ask for a wire recall. Reporting the error as soon as possible can increase the likelihood that you’ll be able to recover your money.
- File a complaint with the FBI. Contact the FBI’s Internet Crime Complaint Center at www.ic3.gov .
The main thing to remember is I am here to help you and am cc’d in any correspondence from the Title Company or Lender. Whether you buying or selling your home in the Desert, if something looks “phishy” or out of the ordinary, always call me to follow up and verify.
I also suggest working with trusted lenders I know and have worked with over the years. With us on your team, you can be assured that we will keep you and your money safe.