Greg's Corner

Protecting your new home from BEC scams

By Greg Collier

Finding your dream home can be exhilarating, yet fraught with unexpected challenges. For one Colorado couple, the process took a devastating turn just days before closing on their new home, highlighting a growing threat to homebuyers, the Business Email Compromise (BEC) scam.

The couple, eager to settle into a family-friendly home, found themselves victims of a sophisticated email scam. Both working in the healthcare field, they were unfamiliar with the nuances of real estate transactions. As they prepared to close the deal, they received emails that seemed to be from their lender and title company. These emails, however, were from a hacker who had infiltrated the email chain, subtly altering the sender’s address to deceive them.

Despite their efforts to verify the wire transfer through their financial advisor, who diligently contacted their financial institution, the funds vanished. They lost over $30,000, a sum representing years of savings. Though they managed to complete the purchase, their financial plans were put on hold.

To safeguard against BEC scams, experts recommend maintaining open lines of communication with your realtor or title company through phone calls or in-person meetings. Verifying wire instructions by phone before transferring funds is crucial.

Title companies often emphasize the importance of wire fraud prevention, promoting awareness of best practices, and encouraging real estate agents to educate buyers early and often.

Following their loss, the couple filed insurance claims with both their financial institution and the title company. However, both companies denied responsibility.

This incident should serve as a cautionary tale for anyone involved in real estate transactions. By adopting preventive measures, homebuyers can protect themselves from falling victim to similar scams. Always verify email addresses, confirm wire instructions via phone, and be wary of any unexpected changes in communication.