CHICAGO (CBS) — The Better Business Bureau is warning about a dramatic rise in real estate email scams, with losses soaring from $360 million in 2016 to $1.3 billion last year.
The scams start when fraudsters send emails to home buyers – posing as attorneys, realtors, or someone else involved in a real estate deal – and ask them to wire money due to a last-minute change. The money ends up going into accounts controlled by the scammers, and the victims never see it again.
“We found that 80% of businesses and other organizations have gotten one of these sorts of emails in the last year,” Better Business Bureau investigations specialist Steve Baker said.
The scams target consumers, too.
Dana Palmieri has been living in her parents’ basement for eight years, saving up to buy her own place. Two weeks before she was set to close on her first condo, the preschool teacher got an email she thought was from her attorney, asking her to wire nearly $11,000 for closing costs.
What she didn’t notice until it was too late was, while the email had her lawyer’s name, it was from the wrong email address.
“When I double-clicked, that’s when I was able to see the difference, after I found out that these were fraudulent,” she said.
No one knows how the hacker was able to find out the details of Palmieri’s real estate closing and start emailing her.
Palmieri lost her money and the condo. She now has to start all over.
“It’s evil, and I don’t like to think that there is evil in this world, because I naturally see the good in people,” she said.
Baker authored a new report highlighting the exploding number of similar real estate email scams. Reports of real estate fraud attempts rose 1,100% between 2015 and 2017. In 2017 alone, nearly $1 billion in real estate transaction costs was lost to fraud.
The Better Business Bureau advises consumers to use the telephone to confirm all financial transactions before wiring any money, and not rely on email alone.