A Denver couple, just days away from closing on their dream home, lost tens of thousands of dollars to a sophisticated scam targeting real estate transactions. In 2023 alone, Coloradans lost more than $57 million to “Business Email Compromise” (BEC) scams, with real estate deals being a prime target, according to the FBI.
Drew and his wife, eager to start a family, were thrilled to find a home that met their needs. They quickly put in an offer and began the process of inspections, document preparation, and endless emails.
“We work in healthcare, so we were pretty new to this process,” Drew explained.
Just days before closing, they received an email that appeared to be a conversation between their lender and their title company, First American. The email discussed closing costs, and everything seemed legitimate.
However, the couple later discovered that they had been communicating with a hacker who had inserted themselves into the email chain. The scammer had copied and pasted an official-looking email, making subtle changes to the address that were easy to miss.
“It’s absolutely terrifying how sophisticated these scams have become,” Drew said.
Steve Beaty, a cybersecurity expert and computer science professor at Metropolitan State University of Denver, explained that real estate closings are increasingly becoming targets for scammers due to the large sums of money involved. Scammers often send phishing emails to brokers or title companies, gaining access to email accounts and the sensitive information within. They then use this information to trick buyers into wiring money directly to them.
“I trust almost no pieces of email,” Beaty advised. “If I’m going to wire money, I’m going to make a call to verify.”
In the LeMays’ case, they followed the instructions provided in the fraudulent email and approved the transfer of more than $30,000. The next day, they were devastated to learn that the wire transfer had never reached its intended destination.
“It’s years of hard work saving that money, and it’s going to take even more years to recover it,” Drew lamented.
While they were able to pull from other savings to close on the home, their plans to start a family are now on hold.
“That’s the heartbreaking part for us,” Drew said.
The couple tried to freeze the transfer but were unsuccessful. They filed insurance claims with both Edward Jones and First American Title, but both companies denied any responsibility. First American Title, which experienced a major cybersecurity breach in December, issued a statement emphasizing their commitment to wire fraud prevention and claiming the LeMays’ incident was unrelated to the breach.
Despite their efforts, the LeMays are left to pick up the pieces and warn others about the dangers of real estate scams. They urge homebuyers to take extra precautions, such as verifying wire transfer details over the phone or in person, to avoid falling victim to similar schemes.