INDIANAPOLIS -- An Indianapolis man has a warning for other home buyers after he lost $42,000 in a new cyber scam.
Chad Butler and his girlfriend had their sights set on a new home in November.
Chad had been saving for his down payment so he wouldn’t have to take out a large loan.
The couple went through inspections, credit checks and filled out all the necessary paperwork. They were days from their closing date when the scammer struck.
"Everything was there from her account. They matched her language styles, her fonts, her signatures were all from her account," Chad said. "From what they had done was sent up a forwarding address so that everything that I had sent back was getting intercepted. It was never even entering her account, it was getting forwarded to another account."
Chad said he lost $42,000 and he almost lost the home as well.
He was able to salvage the deal by taking out the large loan he was trying so hard to avoid, but not everyone may be as lucky.
Here's how this scam works:
First, the scammers hack into the email accounts of the real estate agents and sometimes even the buyer and seller.
The hackers will then quietly monitor email exchanges between the parties involved in a real estate transaction and get their specific information including names, property address, and file numbers.
As the closing date approaches, the scammer will insert themselves into the transaction update the instructions on how the buyer needs to wire the money to the seller or bank. Those emails look legitimate and will have all of the correct markings and numbers, but your real estate agent will never see them.
By the time the seller realizes the money went to the wrong place, it’s already untraceable.
Below are some tips for buyers and sellers on how to protect you from becoming a victim:
Contact your agent before any money exchanges hands: This is key. A simple phone call can save you thousands of dollars. Before you wire any money, always contact your agent over the phone to confirm that the wiring information is accurate. DO NOT rely on email as your only form of communication.
Keep records of all communications: That includes email addresses, website links and anything you’ve used during the process. Double check that those emails are correct. Make sure all web addresses start with HTTPS (The S stands for secure).
Don’t click on links in emails: Just because it comes in an email, doesn’t mean it’s right. Always go to the company’s site and click on their links directly from there. Or type them in yourself if you know it. Do not count on email links to be accurate or safe when it comes to financial transactions.
Keep computer security up-to-date: Updating your system, and browser security can help keep you from becoming a victim of fraud.
Trust your instincts: If something seems off, call and confirm. You may be overthinking things, but when it comes to making one of the biggest purchases of your life, you want to be sure you’re comfortable with every step of the process.