By Lisa A. Tyler
National Escrow Administrator
The wire fraud schemes have evolved yet again. The latest evolution involves fraudsters spoofing or imitating legitimate FNF email addresses. Email spoofing is the creation of email messages with a forged sender address, making it appear that the email is sent from an email address even when it is not. The fraudsters obtain detailed transaction information by compromising the email account of a party to the transaction, typically the real estate agent’s account or buyer’s email account – not the FNF employee’s email – and sending fraudulent wire instructions through an email account, either using a spoofed email address or using an email address which closely resembles that of an FNF employee’s email address.
From there, the fraudsters monitor the transaction, deleting and intercepting legitimate emails containing wire instructions and then sending their spoofed or fraudulent email in an attempt to divert the wired funds at closing to their own account. Read "YOU have hit the Lotto!" to learn more detailed information on this complex scheme plaguing our industry today.
Next, cyber–thieves have discovered the next big jackpot by hacking the email accounts of parties involved in an exchange. Read "EXCHANGE accommodators" to discover how the thieves are attempting, sometimes successfully, to re–direct exchange funds into their own accounts via altered wire transfer instructions.
As mentioned in "OWNER'S title insurance — part I" from last month, the new CFPB rules require any charge allocated to the buyer for owner's coverage to contain the word "optional" in the description on both the Loan Estimate and the Closing Disclosure. In some markets, if the buyer opted not to purchase an owner's policy at closing, the cost of their loan policy would increase.
The CFPB rules require the full loan policy premium be reflected on the Loan Estimate and Closing Disclosure and not a discounted amount. As a result, the mortgagee's policy charge would not increase at closing. The rule calls for discounts to be mathematically applied in an entirely new way, which do not comport with most states' filed or promulgated title rates, or the contractual or customary payment arrangements between the buyer and seller. Read "OWNER'S title insurance — part II" to discover the correct amounts needed to disclose owner and loan policy premiums on the new forms.
Be sure to answer the monthly CFPB question to make certain you understand the effects of the new rules in your market area!