A Gold Coast couple recently lost their dream home to a cunning real estate scam. However, an expert revealed the simple steps banks could take to stop scammers from fleecing the life savings of hardworking Aussies.
Background – real estate scam
Simple steps could save hundreds of thousands of dollars earned by working Australians from falling prey to cold-hearted scammers.
Payee confirmation would be enough to ensure the finances are going into the correct account and prevent interference from impersonators, Gerard Brody from the Consumer Action Law Centre has declared.
The lack of protection in Australia leaves people vulnerable to scammers who can deceive people through their computers.
Gold Coast victims speak up
One Gold Coast couple was devastated when they lost almost $40,000 to a “cunning” email scammer who posed as a real estate agent.
Mitch Wilson and Penny Davies believed they followed their agent’s advice when transferring their property deposit to a bank account.
Initially, they had received an email from what appeared to be their real estate agent’s email address.
“We got an email from the real estate agent we had been dealing with, from their email account saying in light of the contract, please pay money to this account,” Wilson shared.
The couple promptly transferred $39,000 to the bank account without a second thought until the agent contacted them inquiring about the payment a few days later.
“We went back and forth, we exchanged screenshots and emails from their side and ours, and what was obvious is the money didn’t go where it was supposed to go, which was their account,” Wilson said.
“(It) ended up in some fraudster’s account and then offshore to a crypto account.”
Police are calling it an email compromise scam. Scammers infiltrate an email account and send emails to potential victims, making it very difficult to ascertain whether it is a scam.
“These people with these skills, they’re very cunning, they’re very calculated,” Queensland Police Service Cyber Crime Group’s Ian Wells stated.
When a business sends an invoice, hackers alter the bank account numbers and then forward the invoice to the unsuspecting customer for payment.
“Mummy blogger” Constance Hall also fell victim to the cruel scam.
She shared recently that she felt “stupid” after losing thousands of dollars to the fraudsters.
Ms Hall thought she was paying a rental property deposit when she transferred money via a link she received from the real estate agency managing the property.
Upon contacting her bank, it told her that the chance of getting her money back was minimal as she had authorised the transaction.
Her bank reclaimed only $7.57.
“To have it all stolen in an instant … felt unbelievably unfair,” she expressed.
The current banking system in Australia
Police assert that home buyers always contact businesses initially to verify bank account numbers when making invoice payments online.
Mr Brody said the current system leaves Australians vulnerable to scams.
The risk sits with the individual to ensure the account details are correct, and the bank does not cross-check that the account name listed goes to the correct accounts.
The consumer law specialist said there is no bank mechanism to confirm the payee in Australia.
“Reforms in the UK and other countries now require banks to do confirmation of payee,” Mr Brody expressed.
Here in Australia, there have been ongoing calls for our banks to do the same, but thus far, this has not been done to the same extent, which raises significant risks for scams.
The current banking system provides that Australians can only get their money back if their details or cards are stolen.
If the transactions have been approved, as in the cases of Ms Davies, Mr Wilson and Ms Hall, then reimbursement from the bank are much more difficult.
Mitigating the risk of falling victim to a real estate scam
Unfortunately, it can be easy to get scammed, and they can be very sophisticated, including these sorts of impersonation scams.
It may not seem fair, but individuals bear the full losses associated with scams. So the Consumer Action Law Centre is pushing for is there to be stronger measures in place to prevent fraudulent bank transactions from being processed.
Police are urging Australians to contact their bank immediately to report a fraudulent transaction.
In addition, the Australian Cyber Security Centre instructs impacted businesses to report the incident at cyber.gov.au/acsc/report/ and alert other clients and employees.
Businesses also need to report the breach to their email service provider.
Vogue Advisory Group – helping you keep your hard-earned wealth safe
We are dedicated to protecting your super and investment savings and have strict measures to detect suspicious behaviour. If you suspect a scam has duped you or something you have received might be a scam, please contact us, and your adviser can help you.
Do not click on any links or attachments if you receive a suspicious email.