Our Team Practices & Industries Presentations & Publications News About Offices Careers Contact Articles Client Alert: Real Estate Transactions Targeted in Business Email Compromise Schemes Date: September 27, 2021 By: Spencer S. Pollock, CIPP/US, CIPM, C. Andrew Robinson Real estate attorneys, agents, title companies, and other professionals be advised: according to an alert recently published by the Secret Service, the real estate sector is being targeted by criminals, and the frequency of these schemes continues to rise. Business email compromise (“BEC”) schemes occur when a fraudster gains unauthorized access to an email system and uses that access to perpetuate fraud, steal data, and more. While ransomware attacks have been in the news recently, BEC schemes are the costliest cybercrime reported to the FBI’s Internet Crime Complaint Center for the third year running. The FBI reportedly received almost 20,000 BEC complaints in 2020, with an adjusted loss of approximately $1.8 billion. Real estate transactions are particularly attractive targets for those who commit BEC schemes because of the large sums of money that are transferred in connection with such transactions. Typically, the criminal actor uses the access gained in BEC schemes to commit wire transfer fraud by sending fraudulent wire information from the hacked email account to the buyer. According to the FBI, there were 11,677 victims in 2019 with $221 million in losses as a result of wire transfer fraud. This compares with 11,300 reported victims and $150 million in losses in 2018. The instances of this type of fraud and the amount of loss continue to rise, and cyber criminals have taken advantage of the uncertainty caused by the health crisis to perpetuate their crimes. There are a number of ways to protect yourself or your business during real estate transactions (or other transactions involving the wiring of large sums of money): Update procedures to ensure proper verification of information before releasing funds. Enable Multi-Factor Authentication (“MFA”) on all email accounts. Routinely change passwords. Restrict wire transfers to known and previously verified accounts. Have a clear and detailed Incident Response Plan. Any changes on where/how to transmit funds should be confirmed by speaking with the intended recipient of the funds by phone or video. There are more ways to protect yourself or your business when it comes to wire fraud, BEC, and other cybercrimes. Please contact us if you would like more information on how to protect your business or if you have any questions about data privacy or data security. The information contained here is not intended to provide legal advice or opinion and should not be acted upon without consulting an attorney. Counsel should not be selected based on advertising materials, and we recommend that you conduct further investigation when seeking legal representation. ATTORNEYS Spencer S. Pollock, CIPP/US, CIPM C. Andrew Robinson PRACTICES & INDUSTRIES Cyber Security, Data Management & Privacy Real Estate Intellectual Property & Technology Attorney Advertising Privacy Policy Accessibility RSS Feeds Site Map © 2021 Whiteford Taylor Preston LLP. All Rights Reserved. | This is an advertisement. an ICVM Group site