Protecting Yourself (And Your Money) From Escrow Fraud
Escrow fraud occurs when a cyber-criminal either poses as your escrow company or sets up a fake escrow company for the purpose of stealing your money. While escrow fraud has existed in one form or another since escrow companies have been around, technology has made it easier for the bad guys to commit this type of crime.
This is why reputable escrow companies may seem extremely cautious about how information is communicated back and forth. For example, to have money wired into your bank account, you have to provide your account and bank routing numbers to the escrow company. When you learn that your escrow company doesn’t allow you to do that by email, it may seem unnecessarily cautious to you. Remember, however, email accounts can be hacked and if your email has been compromised, a cyber-thief could easily change your account numbers to theirs and send it to the escrow company. And once the money has been wired, there is very little you can do about it.
So, what can you do?
To protect yourself from being part of this $1 billion per year problem, there are several steps you can take to reduce the likelihood that you’ll become a victim.
Pay attention to even the smallest details.
There are a lot of ways to trick you into giving up the wrong information. For example, you might get a very official looking email providing instructions on how to have money sent to you by wire transfer, including a request to reply to the email and provide bank account numbers. Don’t do it. Contact your escrow company at the number you have on file to confirm any instructions you are given. It’s simply too easy to set up a fake email address that’s off by just one letter, which you probably wouldn’t even notice it.
sure you’re using a highly reputable title company.
Another scam that happens far too frequently occurs when cyber-criminals create a website that’s meant to look like a legitimate title and escrow firm. These websites are designed to draw you in and trick you into thinking that you’re reading about a legitimate company. Unfortunately, the purpose of such a website is to get you to provide information that the criminal can use to steal money through escrow fraud. It’s a fairly safe assumption, on the other hand, that if you’re considering a company that has been around for several years or longer, that they are legit. That said, don’t rely solely on the website if you are not otherwise familiar with the company. Check them out for yourself. Or ask your Realtor.
Follow the title company’s instructions to the letter.
Once you have found a legitimate title company, help them help you by following their instructions perfectly. After all, you’re dealing with a company that likely manages millions of dollars every day, and does so under strict federal and state regulations. So, it’s reasonable to assume that they are experts in how to do it as safely as possible.