Cyber Fraud Attacks

Cyber fraud attacks are on the rise. As many of you may have heard, Costa Rica’s Ministry of Finance (also known as the tax administration called Hacienda) was hacked. But the Ministry of Finance isn’t the only one at risk… Criminals have also started hacking email accounts and sending fraudulent wiring instructions to clients involved in a real estate transaction.

Ministerio de Haciendo Costa Rica logoFirst, a little more information on what happened to Costa Rica’s Ministry of Finance. On April 17th 2022, the Ministry of Finance noticed malicious activity and proceeded to shut down the servers. Conti, a group of Russian based hackers, claimed to have hacked the Ministry’s website and taken 1 terabyte of taxpayers’ information. Ransomware had infected the Ministries system encrypting all the information and restricting access. Conti requested the government of Costa Rica to pay them 10 million dollars by April 23rd 2022, or they would release the information. Costa Rica has refused to pay the bribe.

The Ministry of Finance is still working on getting all their servers up and running. The Virtual Tax Administration (ATV) and Customs Information System (TICA) platforms are still out of service. Many obligatory tax filings are being postponed while the systems are being repaired and reinstated. For more information or if you have any concerns, reach out to your Costa Rican accountant or attorney for help.

Image depicting a cyber fraud attacks

Now let’s go over how to best protect yourself during your real estate transactions. Cyber criminals have been hacking the emails of lawyers, brokers, agents, etc to divert funds to the criminal’s bank account. The usual method used by these criminals is by sending an email with fraudulent wiring instructions. These emails unfortunately look very legitimate but there are ways to protect yourself.

One of the best ways to protect yourself is to always call the escrow agent and verify the instructions before sending any wire. Be skeptical, if any information looks off, do not hesitate to call the escrow agent. Keep an eye out for changes in the bank, branch location, account name or number. Also take a very close look at the email address, some hackers are smart enough to use a very similar email address but may change one letter in the email address.

It is important to verify wiring information by telephone (through a secure number) or in person to guarantee the information is accurate and legitimate before sending any money.

image with the word security

Here are some important tips to always keep in mind when doing a bank wire transfer:

  • Communication is key, always stay in direct contact with your escrow agent and make sure to ask for their phone number at the beginning of the real estate transaction.
  • Be wary of “updated/revised” wiring instructions. Always call your escrow agent and personally confirm wire/disbursement instructions. Do not agree to forward wiring instructions to other parties unless these instructions have been verbally confirmed.
  • Do not open attachments from unknown sources or click on any links in emails that look off or strange. They could contain viruses or allow hackers access to your computer.
  • Always confirm the routing number/swift code, the account name that is entitled to the funds, and that emails with sensitive information were received with the escrow agent via phone or in person. 
  • Always use a secure password for all your online accounts and change it frequently. Only use secure wifi networks.

By following the above advice you can greatly reduce the chances of being a victim of a cyber fraud attack.  This digital age comes with many new risks and problems but with the right amount of vigilance and skepticisms you can better protect yourself against fraud. Most importantly, never hesitate to call or meet in person with your lawyers, escrow agents, brokers, or real estate agents. Although it may not be as convenient as an email, you can keep yourself safe throughout your real estate transaction.

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