Strident technological advances and the convenience of instant access to information and electronic communication have made our lives easier in many ways, but it has also opened a whole new world of opportunities for fraudsters.
The fraudster sends a phishing-type email aimed at intercepting email correspondence to one of the parties and then monitors the progress of the transaction, sometimes even phoning the conveyancers to get updates.
Shortly before payment is due to happen, they send a mail from a similar email address notifying the purchaser or conveyancer of a change in bank details. The email addresses are sometimes so similar that it’s easy to miss the small discrepancy.
If the purchaser is deceived into paying into a fraudulent account, they can no longer financially perform in terms of the agreement of sale and will find themselves in breach of contract and liable for damages to the seller.
It’s a horrible double whammy – they lose their money, don’t get the house and have to pay an additional fee for damage.
If you have any doubt about an agent’s legitimacy, don’t be shy to ask for the current Estate Agency Board (EAAB) and Fidelity Fund Certificates (FFC).
A few tips of advice:
1. Know your clients and always personally verify any change in payment instructions.
2. Be especially careful if bank details are changed and independently verify the bank account details directly with the bank. Most banks have systems to enable conveyancers to do this.
3. Do not pay into an account that does not belong to a party to the transaction.
4. Confirm that your agent is legit – you can also verify an agent on the Estate Agency Affairs Board website where all agents who are marketing properties must be registered.
5. Do not ever just click reply to an email when you are sending important information. Instead create a new email and find the person you want to send to in your email address book. That way you avoid replying to a fake email address that looks similar.
6. Buyers and sellers should always ask for verification of the bank account into which any funds are being paid.
7. Any emails requesting a change of banking details should be viewed with suspicion and never use banking details provided in an email unless you have confirmed authenticity.
8. In a fast-paced, digital age, face-to-face meetings are not always practical, however, important documents should always be signed in person and verification of bank details should always be completed.
9. Have adequate insurance.
“Property is the biggest investment most people ever make, so never let your guard down, don’t be too embarrassed to ask for confirmation or verification and follow your gut instinct if you feel uneasy about any aspect of the transaction,” says Bloch.
Article courtesy of property24