We have been advised and have direct knowledge of increased attempts to victimize buyers/borrowers by fraudulently diverting their closing funds to an account that is not that of the title company. In this current environment, many people are distracted, overwhelmed, and working in an environment of modified and sometimes, relaxed protocols. Parties to the transaction are anxious to complete their closings before implementation of further restrictions that may impact the timeline of their closing. Consequently, they may not be taking the time to understand and follow protocols that are critical to the security of their closing funds. Real estate and lending professionals should:
- Discuss wire fraud early and often with their clients;
- Directly, by phone or in person, (NOT via email) provide the buyer/borrower/seller with the telephone number where the title company may be reached (IDEALLY - the parties put the title company phone number directly on the contract);
- Instruct the buyer/borrower/seller to directly call the title company for instructions on how to wire funds to the proper account. Most wire fraud schemes are perpetuated by email communications that are not supported by personal phone call - the buyer/borrower/seller's phone call to the correct title company phone number is an easy and important way to avoid fraud.;
- Never pass-along wire instructions to the client.