Jessica Madalena and Daniel Pietschnig found their dream home.
The soon-to-be-married couple said the 3-bedroom, 2-bath home in Wood-Ridge, the Bergen County town where Medalena grew up, offered “plenty of room to grow.”
But this huge milestone, which should bring homebuyers joy and hope for the future, instead put their dreams in jeopardy.
After an email conversation they thought was legit, they unknowingly wired their down payment to a scammer.
“My fiancé and I were completely devastated upon finding out we were scammed,” said Madalena, 31.
“Daniel called me while I was at work and told me what happened and at first I thought he was joking,” she said. “Then, reality set in and I just started bawling. Everything we had worked for was just completely gone.”
And, they said, no one — not their real estate agent, not their attorney — will take any responsibility for the scheme, which is all too familiar these days.
Impersonation scams involving real estate transactions have exploded in recent years. Nearly one in four survey respondents in fraud prevention software firm CertifID’s 2024 State of Wire Fraud report said they received suspicious communications during their closing process. One in 20 actually lost money, with the median loss exceeding $70,000, the report said.
For Madalena and Pietschnig, documents show the loss was $32,500.
HOW IT HAPPENED
Madalena and Pietschnig signed a contract on Sept. 1, 2022, to buy their home, originally listed for $562,900, for $540,000.
Closing was set for Nov. 7, and the $32,500 down payment was due on Sept. 19, they said.
The fake emails started on Sept. 8, when the couple was part of an email string seemingly between their real estate agent, their attorney and the seller’s attorney.
“Both attorney emails were fake accounts — with one letter off in their email address — that we never caught,” Madalena said.
Someone pretending to be the couple’s attorney said the down payment due date had changed to Sept. 13.
The real estate agent — from her real corporate email address — responded to that message, saying she spoke to the mortgage company and confirmed the funds should be wired, documents show. Nothing seemed amiss, Madalena said.
They made the wire transfer on Sept. 9.
But 10 days later, on Sept. 19, the couple received an email from their attorney — this time from his real email address — saying the down payment was due that day.
“Confused by this, we sent over all the proof that we had already paid the down payment,” Madalena said. “Our attorney immediately called us and this is when we learned we had been scammed.”
Madalena said they looked back at all the emails, and that’s when they discovered the fake addresses.
They filed a police report and the banks promised to investigate.
In the meantime, the couple still had a home to buy. Madalena said her parents gifted the couple some money and they saved the rest in time for the closing.
While the home purchase would still go through, they weren’t about to forget about their $32,500.
WHO IS RESPONSIBLE?
The couple said everyone denied responsibility.
A family friend who is an attorney sent a letter to all the parties, asking them to file claims with their insurance policies.
“Our attorney responded immediately and wiped his hands clean and stated he did not have insurance,” Madalena said. The real estate agency did not respond, she said.
They finally got a call in February 2023, after Madalena’s mom posted on a Bergen County Facebook page telling the whole story — naming names — and asking for attorney recommendations.
“(The real estate agency’s representative) basically mentioned that the Facebook post was making them look bad and it is not their fault that we wired the money and put all the blame on us,” Madalena said.
At the representative’s request, she resent the impersonation emails, but she said they never heard from the office again.
When the couple found an attorney who did not have a conflict of interest with the real estate agency, they sent demand letters, but no one filed insurance claims about the fraud.
The couple said they felt shocked, embarrassed and violated by the whole incident.
“We are looking for them to do the right thing and submit a claim with their insurance company,” Madalena said. “A year-and-a-half later, we are still fighting and we are not going away,” she said.
WHAT’S NEXT?
We’ve seen these scams before, like the couple who lost more than $90,000 after a similar impersonation fraud.
It’s easy for scammers to glean public information, such as from real estate listings, to target professionals involved in real estate closings. If someone can then hack into an agent’s or attorney’s email, it’s like gold to the huckster, who can then use trickery and create email addresses that are substantially similar impersonations to fool the parties into accepting information — including wire transfer instructions — in an effort to steal money.
That’s why insurance policies taken by anyone who is a party to real estate transactions is vital.
In this case, the real estate agency told Bamboozled that after extensive research, there was “zero evidence” its email was hacked.
It called itself “well-insured,” but said its insurance company called it a “third party event” so the agency was not involved.
The couple’s attorney, too, said his email system had no breach — we know it was not a hack, but a fake email that was created to look like the real one — that his contract with the couple specifically warned against wire fraud and that each of his email signatures had warnings about wire fraud.
After Bamboozled’s inquiries, an attorney representing the real estate agency sent a letter to Madalena’s mother, calling her Facebook post about the incident “defamatory” and asking that she retract it.
That’s not going to happen, Madalena said.
The National Association of Realtors said prevention is key. It recommends buyers and sellers read its wire fraud resources and if the worst happens, you can report it to the Internet Crime Complaint Center, or IC3, at ic3.gov.
Madalena said she’s not sure what will happen next, but they are considering legal action.
“Talk to someone before you wire funds. Verbally talk to someone,” she warned.
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Karin Price Mueller may be reached at KPriceMueller@NJAdvanceMedia.com. Follow her on X at @KPMueller.
