As more real estate searches and transactions move online, the threat of cyber fraud scams has put consumers and the real estate community on alert.

“Losses as a result of cybercrime are rising exponentially,” said James Lamphere, Vice President, Title & Escrow, HomeServices of America, the parent company of Berkshire Hathaway HomeServices Florida Network Realty. “According to federal authorities, there were more than 19,000 cybercrime incidents in the U.S. between June 2016 and May 2018 with losses exceeding $1.6 billion. Cybercrime incidents are increasing at over 500 percent per year.”  

The fastest growing form of real estate cybercrime is a wire fraud scam that occurs during the closing stages of the home buying and selling process. In this scenario, the homebuyer receives an email, which appears to be from the real estate company or the title company, regarding funds to be wired to an account for settlement.

The email is actually from a sophisticated hacker, who is posing as someone involved in the closing process. The email looks legitimate because the hacker has hijacked the email account to obtain information about the closing. The buyer receives a genuine-looking email with information on wiring payment, but the instructions actually send the wire transfer funds directly into the criminal’s bank account. Once that happens, both the money and the criminals disappear.

To ensure a secure, efficient and collaborative environment for conducting business, Berkshire Hathaway HomeServices and Gibraltar Title Services have invested in a digital platform that provides encryption technology for document sharing between real estate professionals and their customers. To learn more, visit the Berkshire Hathaway HomeServices Florida Network Realty blog.