What You Should Know About Real Estate Cybercrime in Arizona
From Target to Yahoo, we often hear about cyberattacks happening to major corporations. What we don’t usually hear about is the impact on smaller locally owned businesses, the everyday person, and real estate cybercrime in Arizona.
There’s a common misconception that cybercriminals only have interest in hacking big business. This is not always the case, and these new scams are nothing like the poorly translated ones piling up in your spam box. They’re more sophisticated, and they’re beginning to target real estate transactions.
The first line of defense for buyers? Awareness. So, here are the new cybercrimes that anyone buying or building a house should know.
Cybercriminals are finding holes in security and hacking into the email accounts of clients, real estate agents, loan officers, lawyers and others. This allows them access to any information passed between parties regarding the property, mortgage lending and more. The hackers often monitor activity and wait for an opportune moment to step in and divert funds.
Cybercriminals are known to employ what’s called a “spear-phishing” scam. Once they have access to the desired account, they will send an email from a seemingly legitimate email address and direct buyers to new wiring or routing details for funding a real estate transaction. What makes this difficult is the timing; it is usually highly strategic and centered around key closing dates. Not to mention, hackers often have specific home-buying details — names, addresses, dates, banking information — and can make emails seem as though they are coming from the agent or title company.
Gmail reached more than one billion monthly users in 2016, and as one of the most ubiquitous email providers, there are scams targeting Gmail users, in particular. And it could be one of the ways many real estate users are being hacked.
Here’s how it works: Let’s say someone in your Gmail contact list has already been hacked. You receive an email with an attachment from their now-compromised account. When you click on the image of the attachment, it opens up a new tab in the browser instead of downloading a preview. The newly opened page features a Google sign-in identical to the real one, and hackers capture your login information and gain access to your account should you fill in the well-recognized fields.
It’s pretty tricky. However, there’s a telltale sign in the URL: The phrase “data:text/html,” before the normal “https” language in the location bar. (There are some helpful pictures on the security website WordFence.)
Luxury Real Estate Cybercrime
With emails passing between a number of different parties throughout the home-buying process, real estate transactions are becoming an increasingly common target for such phishing scams. And this certainly includes high-end real estate.
In fact, a savvy Manhattan investment banker encountered a real estate phishing scam while purchasing a $19 million property last year. The buyer’s real estate lawyer used an AOL email account that was compromised. Hackers sent carefully written emails to the buyer during closing and the $1.9 million down payment ended up in the wrong hands. This is one of the most expensive examples of this scam so far.
Real Estate — Arizona
However, it seems cybercriminals aren’t just looking for high-profile transactions in major cities. There was even a recent case in Tucson, Arizona. In December, the phishing scam caught a pair of first-time homebuyers and it cost them their $50,000 down payment.
Cybercrime Red Flags
There are ways to spot these scams. Here are a few things to keep an eye out for in your email.
- Last-minute changes or instructions during the closing process.
- Wire transactions – especially any reference to “SWIFT” wire transfers, in particular, as these can potentially be international wire transactions.
- Requests for social security numbers.
Ways to Protect Your Personal Information
The National Association of Realtors and security experts recommend taking the following precautions.
- Employ strong email passwords: Consider alternating capitalization and using special symbols in passwords to increase security.
- Update passwords: Change your usernames and passwords on a regular basis, and try not to use the same one for all of your accounts.
- Enable two-factor authentication: This adds an extra step to the email login process. After using your login credentials, your provider might text you a code for account access.
- Use a private Internet connection: Connecting to free public Internet at the local coffee shop can be tempting, but it’s certainly not secure. Be sure to use a home-based or private Internet for real estate communications.
- Utilize old standbys: “Snail mail” and fax are secure options when sharing personal information. In addition, consider writing checks instead of relying on online bank transfers.
- Add email encryption: If you have to send personal information over email, add extra protection with encryption. This makes it a little more difficult for outsiders to read private communications.
- Don’t click: Should you receive a fraudulent email, try not to click any links. They could deploy malware onto your computer.
- Delete old emails: Be sure to clean out older communications. This reduces the amount of information a hacker can learn about you.
- Pick up the phone: Call your real estate team members using their official, verified phone numbers to double-check transaction instructions, like wire transfers, before inputting your personal information.
There is a lot to think about when buying or building a house. The good news is your agent is your partner throughout the entire AZ real estate process. Take time with documents. Trust your gut, and don’t be afraid to ask your real estate agent questions — especially if something unexpected pops up in your inbox during the closing process. In addition to taking steps to protect your personal information, a seasoned real estate professional will be able to guide you and ensure a safe and successful investment.