Fraudsters Shift Focus to Big-Ticket Real Estate Closing Scams


The Secret Service has been looking into identifying scammers moving millions of stolen dollars through banks around the New York tri-state area.

A Bloomberg report quotes an agent who says he has been reviewing a government database — the Internet Crime Complaint Center, or the IC3 — looking over business email compromises (BECs), scams where the hackers infiltrate corporate accounts to send fake invoices, contract payments and other false wire requests.

The Secret Service agent reportedly found that there had been over $9 million worth of stolen funds affecting over 50 victims in different sectors in the New York tri-state area — real estate victims lost more than $2 million among themselves.

The BECs have lately found a new target in those who want to buy homes, who fall for scams just as they’re about to close on a dream home. Instead, they end up wiring as much as hundreds of thousands to hackers.

According to the agent, the BEC scammers utilize a “shotgun” approach, initially compiling contact information for various players in real estate, including lawyers, brokers, title agencies, mortgage lenders and others, and sending mass phishing emails to entice someone to inadvertently provide login credentials.

Those duped will send their credentials and then hit an error page of some kind, which they won’t recognize as an indicator that their information has been stolen. The hackers then use the credentials to monitor a real estate transaction for months, learning small details that allow them to swoop in just as a payment is about to be wired and pose as the legitimate account for transfer.

PYMNTS wrote about the research it had done with Featurespace on the problem of fraud, with the data revealing how much officials are struggling to stop the hackers and fraudsters.

Read more: Fed Fraud Classifier Offers Consistent View of Data Across Banks

The Federal Reserve put out its FraudClassifier model two years ago to help address inconsistencies in fraud classification and simplify the system.

The institutions PYMNTS and Featurespace interviewed said they’d lost more than $100 million through the past year.