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Family barely avoids costly escrow scam

Posted at 6:07 PM, Jul 31, 2019
and last updated 2019-07-31 21:21:09-04

CARLSBAD, Calif. (KGTV) - The purchase of a dream home nearly turned into a nightmare for a Carlsbad family, as they narrowly avoided a costly escrow scam.

In late July, Greg Shoman and his wife were just days from closing on a four-bedroom home when he thought he got an email from his escrow officer with wiring instructions for the down payment to be sent that day. In the email, the escrow officer said she was busy and could only talk by email, before sending him a calculation of the closing costs.

"You see so many emails and documents during the process, and you start to become numb to it ... Everything on the email - from the masthead to the signature - looked like the emails we had been receiving from the escrow company during the process," said Shoman.

Shoman went to his bank to wire the money. His bank happened to be the same bank the money was to be transferred to, and the bank confirmed the routing number matched a non-business account in Wisconsin, not a California escrow company. After a call to the real escrow company, he learned the emails were fakes.

"Surprised and angry, and then ultimately relieved you didn't give away several hundred thousand dollars," said Shoman.

Shoman isn't alone. According to the FBI, Americans lost $150 million to real estate fraud last year. In many cases, the scammer identifies pending home sales through the MLS and real estate sites and hacks the emails of someone involved in the sale, before sending out false wiring instructions.

"Be aware, be vigilant, and call your escrow company. Don't be afraid to triple check," said Shoman's realtor, Ilana Huff of Pacific Sotheby's.

Shoman says the FBI is investigating his case. He says a closer look at the emails revealed the email address in the scam message was different from the email address of the real escrow officer.