From the trenches comes a story of a new real estate scam that is worth reading. This was passed on to me by Grace Rudawski and Eric Rudawski, a mother-and-son real estate team with Intero in San Jose. (www.YouAskGrace.com)
In Silicon Valley real estate is expensive, with a median price of over $800,000. The typical good faith deposit is 3% of the purchase price, so imagine how much damage someone could do if they could convince you to wire the good faith deposit to a fake account. This is serious – please read, and pass this one.
From a prominent local Realtor who wishes to remain anonymous:
My email was recently hacked, and unfortunately the hackers are getting smarter and smarter. I wrote up an offer for one of my buyers and I submitted it via email, along with copies of the good faith deposit check, the pre-approval letter and copies of my client’s bank statements with the account number blacked out.
The hackers went through all the documents and sent my buyers an email with my signature pasted along the bottom congratulated them on an accepted offer with the property address of the offer, even though our offer was not accepted, and asked them to wire the deposit amount to the title company asap. They had included wire instructions with their email which included the same name of the title company that they had made their good faith deposit check out to.
The hackers were also sly enough to mention that I would be tied up in meetings all day so my clients acted as requested without giving me a call because they did not want to bother me. The hackers even routinely checked with my client to see how much longer it would take for the wire to be sent out. When my client responded that he was in a meeting and would go to the bank afterwards, they mentioned that if he didn’t get the wire sent out asap, they would pass over his offer and accept another.
With inventory being extremely low and our current market being so hot, my client had made and lost a few offers prior to this point, so out of pure desperation to get his offer accepted, he excused himself from the meeting and ran to the bank to meet what he thought were the seller’s demands being sent through me.
Unfortunately my client did not call, email or text me until after he sent the wire. Within seconds of receiving the call, I called my client to find out why he had sent the wire since I had not heard back yet from the listing agent regarding our offer. I told my client that the emails were not from me and that we had not received an acceptance yet on his offer and that he should go to his bank asap and request the wire to be sent back.
My client went to his bank and requested the wire to be sent back. (However,) once a wire is sent it is in the hands of the receiver to be sent back or accepted. I also requested that my client forward me all the emails that he had received. Upon viewing the emails, I could easily tell that the emails were not from me because they were in broken English and it was easy to spot how my signature was pasted to the emails.
When I confronted my client about that, he mentioned that he thought the emails looked funny and he knew I spoke more clearly than the emails, but bottom line, he wanted that property. Through checking with Google’s fraud department, my assistant and I were able to find out the IP address of the hackers and filed a report with the Internet Fraud Department. To date, we are still waiting to hear whether my client is going to be lucky enough to get his funds back.
Obviously, this is a very serious situation. Real estate scams have the potential to do much more damage than others simply because there is so much money involved. If you are a Realtor, please tell your clients to watch out for this scam. If you are a home buyer, please talk to your Realtor about how, when and under what circumstances he or she will ask you for your good faith deposit. Let’s play safe out there!