SARASOTA, Fla. (WFLA) — A Sarasota home buyer, out $51,133 for a down payment on a house, is furious that Bank of America failed to stop the crook from taking her money, even after she figured out the con and warned the bank.
“The bank should be responsible,” said Sheryl Johnson said. “How could they just allow this thief to take my money?”
This problem started after a computer hacker apparently broke into her real estate agent’s email account and manipulated wire transfer instructions, rerouting the money to the crook’s bank account.
Johnson said she cried in the lobby and begged bank employees to freeze the crook’s account, but she was turned away.
“This is my life savings,” said Johnson, who is a nurse and single mother. “I am in shock.”
She now knows that a scammer apparently changed the bank account and recipient’s name on the instructions and then sent it to Johnson. Since the email came from Newgard’s email address, she didn’t question anything.
Our 8 On Your Side investigation found this is not the first time a scam like this one was successful. In fact, the scam is growing in popularity, and the Federal Trade Commission issued an official alert to the real estate and banking community in March. The alert warned against sending financial information and wire transfer information through email. It also advises those involved in real estate transactions to keep their security software up to date.
In fact, authorities warn that emails associated with real estate agents are targeted because the crook monitors the emails, knowing it’s a matter of time until financial information could come through the account. During that monitoring time, the thief learns real estate lingo, the names of the home buyers and adjusts their language to trick the victim. By the time the real estate agent realizes the crook is posing as them, it’s often too late.
Johnson’s real estate agent, Elizabeth Newgard, of Boyd Realty, did not use an encrypted email system.
Johnson said local police sent her to the FBI, and she says she still has not heard back on whether they are investigating. This incident occurred Aug. 19.
“No one seems interested in helping me,” she said.
She now sees red flags on the wire instructions that she thinks her Wells Fargo banker should have caught. For example, the top of the cover page lists the title agency and attorney name as the receiver of the funds, however, further down the page, an account number for a trust for the scammer is listed. This was not questioned by the bank.
Further concerning is what happened after Johnson discovered she had been scammed.
“We walked right across the street to Bank of America and asked them to freeze that account for us, and we were told we would have to deal with the fraud department through Bank of America to the fraud department of Wells Fargo.”
Johnson says she was told her money had successfully transferred to this stranger’s account, but the bank was unable to do anything about it. This was on Friday, August 19. Johnson says the money was gone and the account was closed by Monday.
“I feel Bank of America really dropped the ball,” Johnson said.
Matthew Daily, a spokesman for Bank of America, said he cannot comment on the identity of the person who took the money but said that the bank is looking into the situation.
At Boyd’s Realty, broker Brenda Boyd May says this is the first time this has happened at her business and that there are no signs that anyone else’s email has been compromised.
Newgard said she is “heartsick” about what happened to Johnson’s money and is trying to reach out to authorities who may be able to help.
“I also want to warn others in real estate so we can have safeguards in place,” Newgard said.
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