Consumer Protection: Fewer Dollars Lost to Fraud
To protect consumers from real estate wire fraud, ALTA founded a coalition focused on building awareness among first-time homebuyers, who can be easy targets for scammers.
Consumer Protection • American Land Title Association
Buying a first home is a big part of the American Dream, but it can turn into a nightmare when buyers are scammed. In real estate wire fraud schemes, consumers get tricked into sending funds to the scammer’s accounts, rather than those involved in the transaction.
“Statistics from the American Land Title Association show homebuyers are not worried about real estate wire fraud,” says Megan Hernandez, ALTA’s public relations and marketing manager. “That is a problem.”
Real estate fraud cost victims $221 million in 2019, according to the FBI’s Internet Crime Report. “Our first goal is to raise awareness about the serious dangers of real estate wire fraud and mortgage closing scams,” Hernandez says.
To that end, the ALTA has founded the Coalition to Stop Real Estate Wire Fraud, which has targeted first-time home buyers to educate them about these scams. “We instruct consumers that there are two main rules: one, be vigilant, and two, protect your money,” Hernandez says. “Consumers need to be suspicious. It’s uncommon for title companies to change wiring instructions and payment information via email.”
Hernandez acknowledges that fraudsters will always look for creative new ways to separate people from their money, but she thinks in the future, with the right information, consumers will get better at detecting fraud. “The potential for fraud will probably always exist, but that doesn’t mean we can’t constantly be vigilant, educating consumers and professionals involved in the transaction about the latest fraud schemes,” Hernandez says.
(Martin Poole/The Image Bank)