Real Estate Articles

REALTOR®: Protect Yourself Against Wire Fraud

At the recent California Association of REALTORS® Fall Business Meetings held this month in Long Beach, REALTORS® from across the state raised concerns about wire fraud. They said wire fraud continues to be very rampant in real estate. Scammers are not just targeting buyers' funds; they are also targeting agents' commissions and hijacking computers for ransom.

"Be very careful about emails you receive. Before making a wire transfer, personally verify by calling the person to whom you are sending money. Do not call the phone number in the email you receive, as it could be the phone number of the scammer pretending to be the recipient of the funds," says Karen Trolan, president of the Silicon Valley Association of REALTORS®

Wire fraud is a nationwide problem that affects all consumers and businesses. The National Association of REALTORS® suggests the following best practices for businesses and emails, including real estate transactions.

Best Business Practices: Develop and enforce formal policies for ensuring data security.

• Create, maintain and follow a comprehensive Data Security Program.
• Create, maintain and follow a comprehensive Document Retention Policy.
• Avoid storing clients' personally identifiable information for longer than absolutely necessary. When you no longer need it, destroy it.

Best Email Practices: Unsecure email accounts are open doors to cyber criminals. Follow these guidelines to help keep that door securely shut and locked tight.

• Whenever possible, avoid sending sensitive information via email.
• If you must send sensitive information via email, make sure to use encrypted email.
• Never trust contact information in unverified emails.
• If an email looks even slightly suspicious, do not click on any links in it, and do not reply to it.
• Clean out your email account regularly. You can always store important emails on your hard drive.
• Do not use free wifi to transact business.
• Avoid using free email accounts for business.
• Use strong passwords.
• Change your password regularly.

Best Transaction Practices: Real estate transactions require flurries of information between numerous parties. This makes for primetime opportunities for fraudsters. How do you secure your deal?

• From the very start of any transaction, communicate and educate. Get all parties to the transaction up to speed on fraud "red flags," and make sure everyone implements secure email practices.
• When wiring money, the person doing the wiring should pick up the telephone and call the intended recipient of the wired funds immediately prior to sending the funds in order to verify the wiring instructions.
• Remember to use only independently verified contact information.
• Stay paranoid. A few years back the director of the FBI almost got taken by an email banking scam. If it can happen to him, it can happen to us

Best Damage Control Practices: It's happened. A breach of data, a successful scam, a hack. What to do?

• If a money wire has gone out, immediately contact the bank to try and stop the funds.
• Notify all affected or potentially affected parties. Many states have data breach notification laws.
• Change all of your passwords. If possible, change usernames as well.
• Talk to your attorney.
• Contact the police.
• Report the breach to the FBI Internet Crime Complaint Center: http://www.ic3.gov/default.aspx
• REALTORS® should report the breach to their REALTOR® Association.

The Silicon Valley Association of REALTORS® (SILVAR) is a professional trade organization representing over 4,000 REALTORS® and Affiliate members engaged in the real estate business on the Peninsula and in the South Bay. SILVAR promotes the highest ethical standards of real estate practice, serves as an advocate for homeownership and homeowners, and represents the interests of property owners in Silicon Valley.

The term "REALTOR®" is a registered collective membership mark which identifies a real estate professional who is a member of the National Association of REALTORS® and who subscribes to its strict Code of Ethics.

Variations of this article have appeared in local area newspapers.

For further information, please email or call the SILVAR office at (408) 200-0100.

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