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Fraud Alert! Legit Email or a Scam? 4 Ways to Tell the Difference

September 07 2023

Thank you to Tech Helpline for sponsoring this article on RE Technology:

phishing hookEmail scams are on the rise. The numbers are scary: Forbes shares that 500 million phishing attacks (tricking people into providing personal details over the internet) occurred last year, double of last year's. In 2022, nearly one-third of a million victims lost over $52 million in the US alone.

Business Email Compromise (BEC) – a deceptive scheme targeting individuals and businesses that are transferring money – in real estate is also spiking. According to FBI data, nefarious real estate-related scams increased 27% in the last two years. More worrisome, the total losses suffered by victims soared – up 72%. And you can read some of those sad stories here, here, and here.

Business-related phishing emails are becoming more sophisticated. Seemingly from reputable sources, they can trick almost anyone. Real estate professionals are at increased risk because they live in a world of high-value transactions and have become more digitally empowered.

The stakes for real estate agents and brokers are high: it's not just your reputation on the line, but potentially tens of thousands of dollars – and your client's trust.

Let's delve deeper into four critical strategies for identifying deceptive emails, ensuring that you and your clients know what to do to avoid falling into costly traps:

1. Closely examine the sender's email address

  • Spotting impostors: Often, scammers create email addresses that mimic legitimate ones. For instance, instead of [email protected], you might receive an email from [email protected]. Such minor variations can be easy to miss, especially during a busy day of property showings and client meetings. Make it a practice to closely study the domain of any unexpected email, especially those related to a financial request.

  • Trusted senders: Maintain a list of known email addresses for clients, title companies, and other agencies you regularly deal with. Cross-referencing your list can often quickly sort genuine communications from fraudulent ones.

2. Be wary of emails requiring immediate action

  • The pressure tactic: A favorite tool in the scammer's arsenal is creating a sense of urgency. By pressuring you to act quickly, they aim to prompt hasty decisions, hoping you'll overlook red flags. They know you are busy and deadline-driven and will try to leverage that with a message that requests a quick response – directing you to click on a link. Legitimate organizations understand transactional processes and are less likely to rush you unduly.

  • Verification is vital: Upon receiving an urgent request, especially one involving financial, account information, or other personal data issues, take a breath. Don't reply to the email. Instead, call the requesting party directly using previously known numbers, not the contact details in the suspect email. Verifying could mean the difference between a secure transaction and a hefty loss.

3. Scrutinize links and attachments

  • Decipher deceptive URLs: Before clicking on any link in an email, hover your mouse over it. This action should display the link's destination. If it doesn't lead to the official website or looks suspicious, don't click on it to avoid the risk.

  • Malware menace: Unsolicited attachments, especially from unknown senders, can be Trojan horses for malware. This malicious software can give hackers access to your computer, compromising client data and other sensitive information. Always ensure your antivirus software is up-to-date, and if your settings don't already do it, run any dubious files through an antivirus tool before opening.

4. Look for spelling and grammatical errors

  • Branding blunders: Look closely at the email's artwork. Scammers often use logos, branding colors, or company slogans that are slightly off. Compare the email's aesthetics to official correspondence or the organization's website.

  • The language of scams: While everyone can make an occasional typo, scam emails often exhibit poor grammar, strange phrasing, and glaring spelling mistakes. Such errors can be due to translation software or the scammer's unfamiliarity with the English language, particularly the unique terminology, acronyms, and phrases commonly used in real estate. An email about an urgent financial matter riddled with such mistakes? It's likely a candidate for your email trash.

Bonus: Educate your clients about wire transfer fraud

Because of their substantial sums, real estate transactions are a prime target for wire transfer fraud. Earnest money and down payment transfers can attract nefarious actors, so everyone should exercise extra caution. Here are a few ways to be preemptive:

  • Proactive client communication: During initial meetings, educate your clients about the potential risks of wire transfer fraud. Ensure they know that last-minute changes to banking details are uncommon and should immediately raise alarm bells.

  • Change Passwords: Before starting the transaction, ask your clients to change their email password to one that is strong and unique. Explain that this is in case their credentials were breached and sold on the dark web in the past without their knowledge.

  • Two-step verification: Encourage your clients always to confirm wire transfer details, especially if received via email. A quick phone call using a known number may prevent a significant financial loss.

  • Banking safeguards: Suggest clients liaise with their banks to set up transaction alerts for substantial amounts. Instant notifications of large withdrawals or transfers can be the first line of defense against unauthorized transactions.

  • Use a highly secure software tool like TrustFunds: Many MLSs across the country offer a service like TrustFunds to secure earnest money transfers and save agents from driving around collecting and delivering escrow deposit checks. Enterprise-grade encryption protects agents and their clients.

Be prepared

The modern real estate agent wears many hats: negotiator, confidant, market expert, and now, digital guardian. Each email you open, link you click, or attachment you download may carry a profit potential but also the risk of deception.

While digital tools enrich today's real estate landscape, they also demand that real estate professionals remain diligent to avoid being scammed by bad actors. The nuanced threats hiding in deceptive email addresses, the false urgency created by scam emails, the dangerous lures of malicious links, and the often-overlooked errors in scam emails have made it imperative for agents and brokers to remain vigilant consistently.

The integrity of the real estate industry is built upon clients' trust. To maintain this trust, agents must help navigate these digital pitfalls. Remember, knowledge is your superpower, and with these high stakes, it's not just about securing the next sale but safeguarding yourself and your clients.

Finally, if you are one of the 750,000 Realtors in North America with free access to Tech Helpline as a member benefit from your MLS or association, reach out for professional assistance whenever you have a question about a digital risk.

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Tricia Stamper is Director of Technology at Florida Realtors®, which owns both Tech Helpline and Form Simplicity.