Wire Fraud Protection Guide: How to Protect Your Closing Funds
What is wire fraud in real estate transactions?
Wire fraud is one of the fastest-growing threats in real estate and first-time homebuyers and real estate professionals are primary targets.
Criminals use email scams, fake wire instructions, and social engineering to redirect closing funds. But with the right steps, you can help protect yourself and your clients with confidence.
Wire fraud happens when a criminal tricks a buyer, seller, or real estate professional into sending closing funds to a fraudulent account. They often do this by impersonating someone involved in the transaction.
Wire Fraud Facts
Wire fraud is a real, growing risk:
$106,557
$106,557 was the average wire fraud loss for consumer recovery cases in 2022. 1
$2.9 billion
Business Email Compromise (BEC) schemes (the category that includes real estate wire fraud) reached $2.9 billion in reported losses across all industries in 2023. 2
46%
In a nationwide survey conducted by the American Land Title Association (ALTA), 46% of title agents reported at wire fraud attempt per month. 3
“The most commonly used fraud method”
Wire transfers are the most commonly used fraud method for BEC schemes. 4
Common Wire Fraud Red Flags
Wire fraud attempts often look legitimate. Here’s what to watch for:
Sender’s email address is different (even slightly) from a prior confirmed email address.
Tip: When reading email from a mobile device, click on the sender’s name to
view the complete email address.
Changes to wiring instructions, such as new routing or bank account numbers.
Words indicating friendship or trust, such as "friend" or "pal", or that are overly thankful or complimentary.
Urgent language that expresses a negative outcome, such as "concern," "don ’t," "prevent," or "avoid."
Unusual writing style or tone changes that don ’t fit the sender ’s usual communication style or seem oddly formal, or overly-polished.
“Emergency” changes to account details, wire requests, or instructions to bypass usual verification processes.
Steps to Prevent Wire Fraud
A few proactive measures make an enormous difference.
What to Do If You Think You’ve Been Targeted
If you suspect wire fraud, even if the transfer hasn’t happened yet, act immediately.
If funds have NOT been sent:
- Stop all communication with the suspicious sender.
- Call your real estate agent or First American representative using a verified number.
- Report the attempt to the FBI’s IC3 website.
If funds have been sent:
- Call your bank immediately — request a wire recall or “SWIFT recall.”
- Contact the receiving bank to initiate a freeze.
- Report the fraud to the FBI via IC3.gov within 24 hours.
- Notify your First American escrow officer or title team right away.
- File a local police report.
Timing matters — early reporting dramatically increases the chances of recovery.
Additional Resources
Unfortunately, there is no guaranteed protection from wire fraud. The above tips can help reduce risk, but this is not an exhaustive list of all cybersecurity best practices.
Please remain vigilant and, for more information, review the references below.