Mortgage Scams Rise with Home Sales
As a responsible Arizona REALTOR®, your Duties to Clients and Customers as defined in Article 1 of the national association’s Code of Ethics includes, “Realtors® pledge themselves to protect and promote the interests of their client.”
Protecting a client’s interests may include informing them about dangers associated with mortgage closing scams – an issue that often increases as market sales heat up.
Davida Farrar, Esq., legal counsel for the Consumer Financial Protection Bureau (CFPB) recently warned consumers to watch out for email phishing scams. “The(se) scams target homebuyers who are nearing the closing date on their mortgage loan,” wrote Farrar. “The scammers attempt to steal the homebuyer’s closing funds…by sending the homebuyer an email posing as the homebuyer’s real estate agent or settlement agent.”
Here are five tips you can share with clients about closings:
- If a client receives an email requesting money or financial information, tell them to call you, the title company or their escrow officer, but DO NOT use any phone numbers or links in the email
- Advise your clients to be cautious about opening attachments and downloading files regardless of who sent them, or “appears” to have sent them
- BEFORE making any wire transfer, clients should ask their financial institution to help identify any “red flags” in wiring instructions; such as, discrepancies between the account and beneficiary names
- Advise clients to confirm receipt of their wire transfer with you or the settlement agent, a few hours after the wire was transmitted
- If they suspect a problem, report it to local law enforcement officials and ask the bank or money transfer company to attempt a “wire recall” as soon as possible.
Related video: Wire Transfer FraudTags: CFPB, Consumer Financial Protection Bureau, Davida Farrar, mortgage scam, phishing, wire transfer fraud