NASHVILLE, Tenn. - It's a crime that has increased 5,000 percent over the past year: Wire fraud surrounding down payments for home buyers.
When you buy a home, you have to send a down payment, and while some people accept cashier's checks, the main way of payment in today's world is through wire transfers, and unfortunately criminals have realized that.
The scam happens when hackers get into email accounts of realtors or loan officers where they monitor the account for days or weeks, looking for the right time to send their own email from that account to the home buyer. When they do, they send legitimate looking documents telling the home buyer to wire their closing costs to secure their home.
"It could be $3,000, it could be $30,000, $300,000," Sher Powers, president of Greater Nashville Realtors, explained. "To that person, it could be the difference between being able to close or not."
For many, there is no way to tell that you're being scammed unless you double-check with the mortgage company or the person leading the transaction before sending the wire transfer.
"When it comes to your money, every time, I would double-check and really protect yourself as a buyer," Powers said.
The scam is quickly becoming one of the biggest in the United States. According to FBI data obtained by The Washington Post, about $19 million in wire transfer frauds were stolen or almost stolen from home buyers in 2016. That number jumped to $969 million in 2017. That's more than 50 times as much money stolen.
While some of the cash can be recovered, a lot of it is sent out of the country, making the funds largely untraceable.
That's why Powers is warning her clients, as well as working to educate her fellow realtors about the dangers.
“Always, always, you’re going to want to check and make sure that whenever someone sends you a wire notice, even if it looks legitimate, call your attorney, call the lender, and confirm that it is actually them and that it is the correct routing number.”