How To Instantly Lose $100K At Closing
When I sold my historic home in 2017, my buyers were right out of a fairytale. Everything about them and the sale was positively wonderful - until it was a train wreck.
Legend has it that on cold winter nights in downtown Wilmington you can still hear the sound of a woman throwing a laptop across the room while shrieking, “GHANA!?”
Everything was buttoned up. I had moved out, utilities where scheduled to stop. It was July 2nd and closing was the next day. The buyers sent a text from their driveway in Colorado announcing the start of their journey toward the coast. Everyone was excited and all of their belongings were already parked in a trailer here waiting for delivery.
Whenever a closing and move-in day happen concurrently the buyers must be in the attorney’s office very early. Yet by 11am I still hadn’t heard anything. I began to pace. Aggressively. Coworkers rolled their eyes: “For God’s sake Casey they just drove all the way from Colorado they not thinking about sending you news bulletins right now!” At 3pm I had worn a hole in the carpet and by 5pm I had become positively nuclear. No one was answering their phone.
Somewhere between pulling out of the driveway in Colorado and pulling into their closing attorney’s parking lot in Wilmington, the buyers received an email from their lender (or attorney, that part was never clear). It looked exactly like every other email exchanged thus far. The email address, their names, banking information, home address and logos were all correct. The congratulatory message congratulated instructed that now was the time to wire their downpayment so that everything would be ready when they came in to sign the next day.
With a few fateful clicks my buyers had wired $100,000 to Ghana. A country made famous by having the fastest backwards runner stole their entire downpayment. Without the criminal effort of holding up a bank, breaking into their house or encouraging them into a multi-level marketing scheme selling leggings out of their garage.
Once a wire is sent, it’s gone. Unless its transferred within your bank, say goodbye. Because God has a good sense of humor the next day was July 4th - a banking holiday. The buyers cried. I looked for things to set on fire. The FBI got involved.
Ultimately someone within their banking chain used insurance to close us. At the time, my case was one of three known in North Carolina. Now part of the reason our contracts have bold faced boxes about WIRE FRAUD. In a Venmo, Cash App, PayPal world we have all gotten too comfortable with sending “mini” wires to pay for everything from pizza to a bike on Craigslist. That's made sending the big wires less intimidating. In just 2021 alone, homeowners lost $350 million to wire fraud.
In my case, the hacker wiggled into the lender's Sent box, copied all of their data, crafted a duplicate email and pushed it out from the Sent box so it wouldn’t populate anywhere and would come from a very legitimate email address. Not to pat this thug on the back, but he did a damn good job.
When you’re buying or selling you will be overwhelmed by the amount of email and requests for personal information. Add the stress of moving, kids, and work and its easy to fire off info and click buttons just to get a task off your plate. So do this instead:
If and when a request comes in to send ANY amount of money during a transaction, call your real estate agent, call the closing attorney and call your lender to confirm the legitimacy of the request. At some point you will need to wire funds. This is normal but triple check. Then head to your bank and let the bank verify and send the wire from their system.
Yours truly does not send $30 on a wire unless my behind is sitting in my bank. My bank calls everyone involved, confirms the numbers and who's involved, then pushes it out from their system. It places the accountability on the banking institution and not on my goofy thumbs. We don’t send the wire unless the real live human on the other end confirms it.
And I suggest you do the same.