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Misdirected Transfers in Financial Fraud
One of the scariest things we’re seeing in financial fraud are these misdirected transfers where it could be a title company doing a real estate closing. It could be a purchase from a company. We had one a couple weeks ago with a fire department. A municipal fire agency was purchasing a fire truck, and they sent their money to pay for the fire truck to the wrong place. And how does this happen? It happens where hackers will break into a system or an email of a company. It could be a small company.

Compromise of Email Chains
It doesn’t have to be any of the companies involved in the transaction. It could be an associated company, could be like a home inspector or even a contractor. On these email chains, they’ll have all the information about an upcoming purchase. For example, in a real estate transaction, there are lots of people involved in that transaction: home inspectors, mortgage brokers, insurance companies, utility companies, electrical, cable TV. Any of these companies involved in the closing will know when the closing is happening. So, a lot of these emails are CCed to all these people so everybody knows when the closing is happening, how much it is, and what the details are.

Cybercriminals Targeting Transactions
These hackers will gather up all this information and, at some point, they’ll say, “You know what? We’re going to attack this transaction.” And what they do is, when the time is right, they send an email to the person paying the money, saying, “Here’s where you send the money. Here’s your wire transfer.” They make the email look like it came from the right place. They have all the right names, all the right logos, all the right information.

Consequences of Misdirected Payments
The poor buyer sends their money to a hacker, and it’s overseas, and it’s gone. The same thing can happen in business if you’re buying a large piece of equipment. The hackers will monitor it, maybe the supplier’s some low-level tech person. They get the information, they send the buyer the wire transfer information, and it’s wrong. So, this cybercrime is very, very difficult.

Simple Prevention Tip
There’s an easy way to prevent it: if you just send a test payment before you send any big amounts by wire transfer. Send 100 bucks, 50 bucks, whatever it is, and make sure that it goes through properly to the right place. For the kind of money we’re talking about, it’s very important to prevent it. Because if you don’t prevent it, you could lose all your money for your down payment on a house. If you’re a business, you lose your purchase of the equipment. In the case of that fire department, you know that was money they had saved up for years to buy a new piece of apparatus, and without that, it put their community at risk.

Practical Steps for Protection
Do this test anytime you send a large transaction. You can check out our website, verifyescrow.com, for instructions. There’s no cost. It’s something that is just a free checklist of how to do a large transaction. You want to send a test wire transfer before you send anything large and then verify with the actual recipient that they got that small payment before you send the whole amount.

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