Winners, Losers, Spectators and Cheaters!

It seems high profile sports teams and athletes are cheating more (or getting caught more). Deflategate and Sign Stealing are just two examples of prominent teams and their leaders caught cheating.

It’s not just players and coaches, sometimes the referees are the culprits. In 2007, a referee served 13 months for “point shaving,” which for those unfamiliar, means making calls to change scores.

However, one thing I don’t see is spectators cheating to change the outcome of games we love. Yes, the home field advantage may sometimes be real, but I can’t recall fans causing teams to win or lose directly.

With the big game behind us, let’s focus and draw an analogy to the cheaters (cyber-criminals) in our game (closings). Unlike sports, these cheaters are not the players, coaches and GMs (or in our business known as parties, agents, mortgage pros, builders and attorneys), they’re the spectators (Cyber Criminals). These spectators are not our fans, but they are constantly on our field.

Cyber criminals are the spectators for at least two reasons, (1) they are watching us, all of us, whenever possible through “broadcast TV” (known as internet) and (2) they aren’t supposed to be in the game or impacting the game but they are!

One headline from a CNBC headline dated 9/11/19 notes, “Email wire fraud is so simple for criminals to pull off, its cost companies $26 billion since 2016, says FBI” It hasn’t just cost companies billions, its costed individuals and society billions.

There are several cases throughout the country where hundreds of thousands of dollars to millions of dollars, has been intended to be wired to an escrow account but went to a criminal, some of which reside right here in the USA and some throughout the world. Sadly, it will happen again and these criminals will often get away with it!

Cybercriminals are here to win, and all of us, who are supposed to be in the game (e.g. parties, agents, loan officers, builders and closing agents, etc.), have to play hard and smart to assure the Cyber Criminals lose!

They want to win one thing – our money! It could be money to or from a firm’s escrow account, a broker’s escrow account, lender proceeds and buyer and seller funds. Cyber-criminals watch us all to find the weak link and go for the score! One win is a tragedy for someone, but these criminals win too often.

Our field of law has often been described as “happy law.” In fact, our slogan “Everyone Walks Away Happy ©”describes what we want to always happen. When we came up with the slogan, this type of cyber fraud was rare or non-existent.

Today in order to win we have to all work together to ensure victory. In sports, teams win with a game plan! So what is our plan? I lay it out below:

  1. Like any team, we start by not underestimating our opponent! The opponent is not your “co-op agent (short for cooperative), the parties, lender, the builder. Our opponent is the cyber-criminal. Our opponents are smart, even perhaps brilliant and they are ruthless lawbreakers. So, let’s acknowledge we face a formidable opponent!
  2. As the current ad says, “Stay in your lane bro!” If you’re an agent do not ask for wiring instructions, don’t offer to collect the Seller or Buyer info sheets. You have done the “heavy lifting” and while you don’t want to actually obtain or provide these items, you can certainly speak with your client and Shafritz & Dean (or another firm) to confirm things are being done timely. The cyber-criminals most often breach the “weakest technology link,” in the transaction. Lenders and closing firms spend thousands and even millions of dollars to safeguard NPPI (Non-Public Private Information). Most often, the spectator has their eyes on the agent who is more likely to use Gmail, etc. with limited investment in cyber protection.
  3. Great coaches are great communicators. Coach your clients and those sending funds to call the law firm for wire instructions or receive them through secure emails, and to verify by calling only the number you provide the party face to face or after a thorough internet search for the accurate information. This would also apply if brokers were holding earnest money (EM). One common scheme we see ourselves is the cyber-criminals telling parties something like “today is a busy day. Don’t call me just email me with any questions.” Tell your clients about this because it is almost certainly a fraudster masquerading as the closing firm employee. Insist they call and speak to someone at the firm directly.
  4. The old expression that the “devil is in the details” applies. The best teams pay attention to the details. Look closely at any email instructing you or your clients to wire funds. Both you and your clients must hover over the email address/name & check to ensure the addresses are correct. Criminals often are outside the country and their English (or computer translation) sounds nothing like any professionals English. Often the sentence is incomplete, partially incoherent and if it did not work, funny.
  5. Keep learning! The game is always changing. The criminals are always learning and adapting so we have to as well.

Remember we want to win the game, celebrate a milestone event and while there is no “I” in team there are two “i’s” in criminal. Go team and let’s win!

Posted in Buyer Beware.