Co-op Board Packages: Safeguarding Your Identity

Posted by Toes

Thu Jan 3rd, 2008 09:39 AM

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Recently, one of my customers had $15,000 stolen from her checking account. The incident happened about three weeks after her board package had been submitted to a co-op board. The thief allegedly called Citibank with sensitive personal information such as her bank account numbers, social security number, date of birth and address. The scam artist changed some of my customer's account information and was somehow able to walk into two branches in Westchester, two times each, and withdraw $15,000 in cash. She also opened a credit card with a $750 limit and charged it to the max. I am sure the impersonator's photo has been captured on a security camera somewhere and she will hopefully be caught.

It is certainly possible that this incident had nothing to do with my customer's co-op package. Maybe she left her wallet somewhere. Perhaps someone at her office picked up some of the information she was faxing to me or to her mortgage lender out of the fax machine. But it does seem to be a bit too coincidental. I was happy to report that I had already shredded all of her personal information as I do with all board packages. Out of the dozens of co-op transactions I have done, none of my other customers have had this happen to them.

A special fraud unit of the NYPD is investigating the situation & hopefully the impersonator will be caught. My customer has had her money returned to her, but this incident has taken a considerable amount of her time. She also has to worry about who has her personal information and when her identity might be stolen again.

I think this type of incident is fairly rare and there is no reason to be paranoid when submitting a board package. But it never hurts to be extra cautious!

It is important for buyers of co-ops to know who sees their personal information:

1. Their real estate agent and any assistants who help them compile board packages.
2. Their real estate agent's sales manager who gives the package a once-over.
3. The seller's real estate agent and their sales manager then reviews the package.
4. Some companies have a mail room that types and makes copies of board packages for them.
5. The buyer's mortgage lender.
6. The managing agent of the co-op board.
7. A messenger service if the board package is delivered via messenger.
8. The co-op board's screening committee, usually 3 - 6 people.

Unfortunately, I think that some co-op boards are not really educated on what to do with board packages once they are done with them. One board member admitted that she has a pile of them sitting in her apartment because she doesn't really know what to do with them. Many board members probably don't have shredders in their apartments. I wonder how many board packages just end up in the garbage?

After this incident, I realized that further steps are needed in addition to my just shredding my customer's information. We unfortunately can't just trust/assume that the brokers, messengers, board members, etc., will exercise the same care with others' personal information as they would with their own information.

So here are some actions you and your real estate agent can take in order to protect your personal information:

1. Black out with permanent marker all but the last four digits of bank account numbers on the *copies* of the board package. The original copy that goes to the managing agent does need to include complete bank account numbers.
2. Black out all but the last four digits of the social security numbers on all copies of the board package. The only place a SSN is really needed is on the credit report form that the managing agent uses to run the buyer's credit.
3. I've now decided to include a self-addressed envelope in each board package with a letter. The letter says something to the effect of:

Dear Members of the Board:
In order to protect my customer's sensitive personal information, I would be so appreciative if you would be so kind as to return his/her board package to me for shredding. I have included a self-addressed envelope and please send me your name and mailing address and I will gladly reimburse you for postage. Thank you so much for your consideration.

Even if board members don't return the package to me, I hope that the letter in itself will remind them of the importance of protecting prospective buyers' personal information. Thus far, I have submitted two packages this way. I hope both Boards respond favorably. Both managing agents have promised to try to help me to make sure my customer's information is protected.

I recently joined the Membership Committee of the Real Estate Board of New York City (REBNY). I hope to discuss with them the possibility of coming up with Standard Operating Procedures (SOPs) for brokers, managing agents, and co-op boards for protecting our customer's sensitive information. I am sure this issue is already on their radar, but it never hurts to have another person speak up!