A New Jersey lawyer, overlooking a phony email address, had a title insurance agency send $579,000 from a real estate closing to the wrong person, the agency claims in state court.
ABL Title Insurance Agency LLC sued attorney Jordan Yuelys and his Hackensack, N.J.-based law offices in Morris County Superior Court Oct. 22.
The dispute stems from a real estate closing for a property at in Hillsborough, N.J., in which Yuelys allegedly represented the buyers and retained ABL to perform certain related title services.
Though Yuelys was to act as the settlement agent, since he was “unable to attend the closing due to a personal matter,” he asked ABL on June 25, 2015 – one day before the closing – to act as the settlement agent, the complaint says.
The transaction was completed the following afternoon, and the sellers, nonparties Anthony and Antoinette Foord, received their portion of the sale proceeds by check, ABL claims.
Meanwhile a third party “replicated the signature block of the sellers’ attorney ([nonparty] Richard A. Gomes Esq.) and using an email address resembling the sellers’ attorney’s email address, sent an email to defendants, as the buyers’ attorney,” the complaint states (parentheses in original, brackets added).
“The fraudulent email purported to forward a message from the sellers requesting payment by wire rather than by check, and also requesting that the funds be wired to a corporate account, and asked defendants what they would need to get this done,” the complaint says.
“Apparently not noticing the different email address used by the hacker, defendants responded to the third-party at 3:08 p.m. (after the transaction had closed) requesting wire instructions and noting that there would be a $15.00 charge for the wire,” it continues.
The hacker then asked Yuelys to wire the funds to a bank account in the name of “Nat Jay Music & Ent LLC,” rather than the name of the sellers, ABL claims.
After Yuelys forwarded the hacker’s email to ABL, the latter’s employee replied that she would send the wire Monday morning, according to the complaint.
Yuelys then emailed the hacker that “the ‘clients’ would receive their money the following Monday,” the plaintiff claims
“Again, defendants did not inquire about the status of the checks that were delivered to the sellers at the closing. Nor did defendants raise the issue of the different email address from that of the sellers’ attorney used by the hacker,” the complaint says.
When the hacker resent Yuelys the wire instructions that Monday, the “defendants forwarded the Hacker’s email to ABL at 9:41 a.m., without comment,” ABL claims.
“Acting as agent for defendants, and required to follow instructions from defendants, its principal, ABL then initiated a wire transfer in the amount of $579,360.48 from ABL’s bank account to the bank account listed in the hacker’s email,” the complaint says.
“The hacker absconded with a large portion of these funds, and ABL has not recovered any portion of the stolen funds,” the complaint continues.
ABL therefore “has had insufficient funds in its bank account to cover disbursements from multiple real estate closings,” the agency claims. “To date, ABL has incurred damages of approximately $300,000 and such damages continue to accrue.”
ABL says the transaction has damaged its reputation as well, and that it has been slammed with attorneys’ fees and costs of investigating the matter.
The title insurance company seeks unspecified damages on claims of negligence and breach of contract.
It is represented by Jonathan Vuotto with Riker Danzig Scherer Hyland Perretti in Morristown, N.J.
Yuelys did not immediately respond to a request for comment from Courthouse News.