Real estate transactions typically involve hundreds of thousands or even millions of dollars, making them a target for scammers to exploit. A Silicon Valley tech executive fell victim to a fraudster when she was tricked into transferring nearly $400,000 of her personal savings during a home purchase wire transfer – fortunately, she reported the incident in time.
Bank wire transfers are often faster and can involve large sums of money compared to other payment methods, with transactions typically becoming irreversible after 24 hours. While some banks allow senders to file for recall within a week, customers are cautioned that recovery becomes difficult after the initial 24-hour window.
Rana Robillard, a 55-year-old tech company veteran who served in various roles including Chief People Officer at HackerOne, shared her experience publicly to raise awareness of wire fraud in real estate transactions, admitting, “It’s not a proud moment for me.”
After over a year of online research, Robillard discovered she outbid three competitors to purchase a newly renovated four-bedroom house in the leafy suburb of Orinda, California. On January 29th this year, she received an email seemingly from her mortgage broker directing her to wire the down payment of $398,359.58 to a JPMorgan Chase account. Believing the email to be legitimate due to prior inquiries with the broker, she transferred the money promptly.
Upon receiving a duplicate payment request the next day, Robillard realized she had been duped, leading to six months of panic. Involving four banks, she reported the fraud to her account-holding bank Charles Schwab immediately. The FBI’s San Francisco office notified her on February 2nd that the funds had been located and frozen.
Despite being initially told the funds might be unfrozen after 90 days, Robillard’s frustration grew as JPMorgan largely left her in the dark. The FBI informed her that once the bank froze the funds, their involvement ceased. She tirelessly reached out to elected officials and government agencies, including the California Attorney General, the FTC, and the CFPB, seeking assistance to no avail until early July.
Awaiting news on her money, Robillard faced financial distress and even dreamt that the house had been relisted for $1.63 million. Finally, in July, she received a $150,000 wire transfer from Ally Bank and nearly $250,000 from Citibank, reclaiming her full amount. A JPMorgan Chase spokesperson emphasized the importance of verifying recipient information before transfers and maintaining vigilance until the last moment.
According to FBI data, email scams related to real estate transactions have surged over the past decade, with total victim losses climbing from under $9 million in 2015 to $4.46 billion in 2022.
Charles Schwab urged clients to “stay vigilant, safeguard personal information, and approach financial transactions with caution.” Robillard acknowledged the need to verify emails and payment requests with Opendoor Technologies Inc.’s title company OS National before proceeding. Opendoor, headquartered in San Francisco, offers online instant quotes, repairs, home buying, and financing services.
To this day, Robillard remains unaware of the perpetrators. The nature of online crime has demonstrated increased complexity, with fraudsters infiltrating mortgage brokers, real estate agents, lawyers, or other advisors’ email systems to send seemingly legitimate emails or information.
Naftali Harris, CEO of anti-fraud startup SentiLink, explained that once fraudsters receive payments, they swiftly transfer the money to other accounts, where they can withdraw it as cash, convert it to cryptocurrency, or use money mules for laundering, making it difficult to recover funds in wire fraud cases. Harris remarked, “The faster fraudsters move money out of the initial account and through more financial institutions, the more advantageous it is for them, as it complicates and hinders tracing the transfers.”