Lost Your Down Payment? Here's What To Do First.
If you are the victim of real estate wire fraud and and dealing with a stolen down payment, it is imperative that you move fast. Hours - no - SECONDS are of the essence when someone steals your money in this way. But what do you first?
I completely understand this overwhelming, nauseating feeling of powerlessness and fear. In fact, it is one of the worst things that I have ever felt in my entire life. But now that I have made it through to the other side, I have a few things that you can do NOW if you are facing a stolen down payment through wire fraud. Let's get started......
1) CALL YOUR BANK. As soon as you realize the scam, put a fraud claim in with your wire department to see if they can stop payment. Wires take around 4 hours to process, but funds leave your bank pretty quickly.
2) CALL THE RECIPIENT BANK. You likely won't have an account at this branch, so there is not much they can do with you, but call their wire department and/or their fraud team and let them know. They may be able to put a flag/hold on the funds they received from your stolen down payment.
3) FILE A CLAIM WITH IC3. This is the internet crimes unit of the FBI where you'll want to make a claim. I received a call from an agent the same day, but you may not receive a call.
4) FILE A POLICE REPORT. Likely, the crime was perpetrated outside of your local police station's jurisdiction and involves several states or countries. File a report anyway, and be sure to follow up later. Your PD may not be sure what department will handle your case and you may get passed around. Subpoenas take 30-50 days which is far too long to be helpful, but this step is necessary for documentation and visibility.If your wire was over $50k, the FBI might be your best bet, but it is vital to have everything documented, especially if the fraudster's bank was able to flag/hold your before it left the scammer's bank account.
5) CALL EVERY DAY. When it happened to me, I called my bank and the fraudulent account holder's bank every single day. Often this meant I spent hours on the phone being passed between the wire department, the fraud department, and eventually, it was escalated up. It was often a carousel of misinformation from my bank, dashed hopes, and frustrating transfers, where I would be transferred so many times I ended up where I started. That all being said, you MUST CALL EVERY DAY.
6) WRITE EVERYTHING DOWN. There is no way you can remember everything that happens. The day after my fraud occurred, I took notes of what, when, and how I came to be in the situation I found myself in. I documented exactly what happened, as it happened, and after it happened. The crime will get fuzzy in your mind as time goes on; there will be too many details to track. Write it down and print out emails or text correspondences. Document everything.
This is also true for your calls to all involved parties. I kept a record in my day planner of every call I had. I wrote down why I was calling, what time, with whom, what number I dialed and who specifically I spoke to and what they told me. When dealing with banks, you will likely get transferred 5+ times per call. When you go to follow up, this information may or may not be useful but it will help keep you sane. Ask people's names, and if needed, you'll have a record of such things like "Well, X person told me this yesterday and to follow up with you, at this number today." You will get tossed around as big corporations are really good at protecting themselves, so you might often get stonewalled, but having a record will help keep you sane and keep things aligned after spending hours on the phone.
7) CALL SOME MORE. Don't just email, but also email after you call. Since this happened to me, I've spoken to folks that found the contact info of bank higher ups from LinkedIn or other sources. I would call every single day and rely on that, but you can also email. Email, if done alone, makes us feel like we are working on it, but it often gets ignored.
8) SPEAK TO A LAWYER. The horrible thing about real estate wire fraud is that due to privacy laws (which are otherwise great), your hands are tied when reporting a fraudulent case to another bank if you don't have an account with them. To protect their customers (innocent until proven guilty) and themselves, they simply cannot just give you your money back even if they managed to freeze the account before funds were withdrawn. They have to document a crime, do their research, and do their best to not get sued. That being said, the process will be long and frustrating. Scammers move fast, everyone else moves slow.
Speaking to a lawyer can be incredibly helpful in overcoming many of these hurdles if reclaiming your stolen down payment hits a wall. You will have someone in your corner who knows more about the process than you do. Do note, that from what I understand, you can only sue if there are damages. If you find that you are unable to get your funds back, and someone was culpable (it usually isn't the banks, as they were not the ones who were compromised by scammers) you can then (typically) sue for the lost funds from whomever was compromised (email account, title company, etc.), and legal fees can be included as part of your damages. Often lawyers will take a call or meet with you for free to assess if you're a good fit, so don't let fear of losing MORE money stop you from at least getting a second opinion, or maybe even a third.
Because you documented what happened while it was fresh in your mind, you will be able to provide all the details to a lawyer. REMEMBER, print out all emails, fraudulent and otherwise. Take copious notes with times and names of those involved whenever possible.You should have a timeline of what happened that led up to the fraud, what happened after the fraud and who was involved at the banks, title company, real estate agency, etc. These documents and data can become a part of the legal record and can be what gets your money back. Plus, it really helps your lawyer know what legwork has already been done and what still needs to occur.
9) GET CHEERLEADERS. This process was heart wrenching for me. It literally made me ill. I broke out in a stress rash and was having trouble sleeping and functioning, not to mention my back started seizing up. Stress is brutal and can manifest in different ways for different people, but for most, emotional stress is physically exhausting and this process can be long. I nearly lost my entire life savings of $52,000+ and as a single gal, (although I imagine it's not any better for you) that stolen down payment was all I had. I was going to lose my dream home, earnest money, inspection fees, and have to keep paying on an apartment. There were days I wanted to hide from this - not call, not tweet, not check in on my case. It was exhausting and honestly, humiliating. Luckily for me, I had posted my horror story on Facebook and a few really fired up friends checked in on me almost daily and kept pushing me to not give up. You will be exhausted, scared and this process is long and frustrating. Recovering your stolen down payment is a marathon, not a sprint. Treat this like a death. It may sound odd, but this is just as jarring and scary as losing a loved one unexpectedly. Honestly, it's like the (potential) death of a dream and a nightmare you never saw coming. If you can manage it, try to take time off of work to make calls, as you likely won't be sleeping. Not to mention you will be on the phone half the day.
Lastly, when people ask how they can help, be honest! Ask them for a meal, a hug, or to help with your kids/pets. Let people know that you need emotional support, since you are going to be in the ring for a long while.