Data from the Federal Bureau of Investigation (FBI) point to boom times for real estate fraud. In 2022, real estate fraud cost victims $396.9 million, a 13.30% rise from 2021 and an 86.18% rise from 2020. More than $132 million more was lost to real estate fraud in 2022 than to check and credit card fraud, which get the majority of the headlines.
As the FBI notes, these crimes can be devastating for individuals, who could lose their life savings or the opportunity to use money from a home sale to purchase another property. Loss of a commission or fee is the least of the worries here. Imagine how you would feel if your actions caused someone to lose everything they had. Imagine what that client will say about you, and the damage this could cause to your business and professional reputation.
Why Is Real Estate Fraud Rising?
Real estate is a preferred target for criminals for one reason: wire fraud. Few other industries move money from individual clients at the level of real estate professionals. A single transaction can be worth $250,000, $500,000 or over $1,000,000. All a criminal has to do is grab one of those transactions for a massive payday.
Sophisticated criminals know that real estate wire transfers are low-risk, high-yield opportunities. Why settle for a few hundred dollars from a stolen credit card when a single wire transfer could be worth hundreds of thousands?
How Real Estate Wire Fraud Works
The majority of real estate wire fraud cases stem from business email compromise (BEC) attacks. You may currently be in the crosshairs of a fraudster and not know it.
These attacks follow ..
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