Roughly five million Americans buy homes annually, often sinking their life savings into purchases. However, in a growing brand of organized crime, some of the most sophisticated buyers are tricked into redirecting the money wire-transferred to close on a home or pay off a mortgage into the hands of criminals.
Reagan Bartlo, who had spent her career in the financial industry and online security, was a victim of one of these crimes.
A Dream Home Found and Money Stolen
Reagan Bartlo and her husband discovered their dream home in a quaint West Virginian community only a few hours outside Washington, DC.
“You could see the finish line,” Bartlo said. “All we had to do was wire the money and then go sign the papers and then, in a matter of minutes it all came crashing down.”
Days before closing, Bartlo received an email that looked like any other she’d received from her title company. When describing the fake email, Batlo said that it said, “‘Congratulations,’ we’ll be ready to close on Wednesday and all you have to do is go ahead and wire your funds and that way all you have to do is come in and sign.”
It made perfect sense, and Bartlo followed the wiring instructions, unaware she was falling into a trap.
When closing day arrived, she received an email saying the signing would be delayed an hour, from 4 P.M. to 5:30 P.M. Barlo called to ask why.
“She called me back right away saying ‘Your closing is still at 4 [p.m.] today. You haven’t been talking to the title lawyer.’ At that point, my whole world fell apart because I had already wired all of the down payment money for our house,” said Bartlo. “And that was about $255,000. And so our nest egg, our savings, everything at that moment was gone.”
Bartlo has said she still gets sick when she thinks about it.
“I just remember shaking a lot and not being able to think straight. To feel like everything you had saved for to be able to have financial stability was just taken,” said Bartlo. “And what if I didn’t have a house? My mother lives with us. Where was she going to go? What were we going to do?”
A Common Scam
Tom Conkright, the founder of CerifID, a technology that helps prevent wire fraud, says this happens daily and sometimes multiple times daily.
“Your best-case scenario is a consumer losing their downpayment,” said Cronkright. “Your worst-case scenario is you’re a cash buyer and your entire life savings is gone in a single wire transfer.”
Conkright, who started CertifID after he was a victim of similar theft in 2015, shares, “The reality of it is these are some of the most sophisticated bad actors that have invested hundreds of millions of dollars into their own tradecraft.”
Known losses are estimated to be around $500 million a year. Still, Conkright has shared that the number may represent as little as 10%, and actual losses may be closer to $5 billion annually. These are losses most people never recover.
Moving Forward With a Purchase
Bartlo realizes she is lucky. Because of her fast thinking in alerting her bank, her account was frozen before the criminal was able to withdraw all the funds, and she was able to save roughly half of the $255,000 that was originally wired. To move forward with purchasing her home, she had to withdraw money from a retirement account, which resulted in a significant penalty on top of an already devastating circumstance.
Unfortunately for Bartlo, few US Attorney’s offices have the resources to invest in losses considered small in the scheme of federal crimes.
Conkright, who has said these criminals are opportunistic, does not only target buyers and sellers. Title companies and law firms are equally large targets, with mortgage payoffs being intercepted. He shared that the average person loses $80,000, while a title company loses about $300,000 per incident.
