According to the American Land Title Association, 76% of title agents noted wire fraud attempts either remained the same or increased in 2020. As scam tactics become more sophisticated, the chance of it happening to you only gets greater. Let’s take a moment to go over the basics of wire fraud and see what you can do to prevent it.
First, what is wire fraud? The definition of wire fraud comes from how scammers use telecommunications or the internet to intercept money. For example, let’s say you are partnering with your title company to move money into your escrow account. Wire fraud can occur during this process when a cybercriminal attempts to mislead you or your title company into moving money into a fraudulent account by impersonating one of the relevant parties (such as you, the real estate agent, mortgage lender, or escrow officer.)
If you fall victim, recovering the funds can be challenging. In 2020, only 29% of wire fraud cases were fully recovered, according to ALTA.
What can be done to prevent wire fraud? In the event of wire fraud, time is of the essence. If you and your title company act quickly enough, the wire could be blocked and recovered. However, there are a few things you can do to prevent it from even happening.
- Make sure to note your escrow officer’s and real estate agent’s official phone numbers – if something feels fishy, contact them using those numbers instead of what’s provided in a potentially fraudulent email
- In general, any changes in the wiring instructions are a red flag. Always cross check wiring instructions in person (preferably) or over the phone using their original phone numbers.
- Most importantly, use a reputable title company that has a wire fraud prevention procedure in place.
Want to learn more about how we protect our clients from wire fraud? Our partnership with CertifID ensures our clients are protected – read more about this partnership here.
Interested in learning about how we helped block and recover a fraudulent wire? Read more about a recent case out of Georgia where Stewart and CertifID worked to recover a client’s funds.