Reports of major data breaches and ransomware events that compromise the security and privacy of unsuspecting victims are growing increasingly common. Using a variety of techniques, cybercriminals exploit system vulnerabilities to commit cyber attacks of all scales and turn a profit.

Even large transactions—the sale or purchase of a home, which often requires wiring funds—are in the crosshairs of some fraudsters. In our 2024 State of Wire Fraud, we found that 1 in 10 consumers were targeted for wire fraud, and 1 in 20 consumers fell victim to fraud.  

So what do these alarming trends mean for you and your potential real estate transaction? Are wire transfers safe? 

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Wire Transfers Explained

A wire transfer is a common method for electronically moving large amounts of money between two parties or banks. In the case of a home sale, this could look like an escrow account dispersing funds between a buyer and a seller.

To safely facilitate the electronic transfer of funds, the closing and title service must accurately document the personal and financial information—bank account numbers and transfer amounts—of both parties involved in the transaction.

The widespread use of wire transfers has made the closing process faster and more secure. Closings used to be handled with paper checks, and it could take days or weeks for banks to determine if funds were sufficient to finalize the transaction, by which time the seller could have already transferred funds or conducted other transactions. Because of these delays, fraud thrived in real estate transactions. 

With wire transfers and automatic checks, banks and parties involved in these kinds of transactions can now more quickly detect fraud.

Despite it being quicker to detect fraud, however, electronic transactions are still vulnerable and require increased security to protect everyone involved.

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Wire Transfer Security Trends

The COVID-19 pandemic resulted in an increase of digital and remote transactions, which also led to an increase in the frequency of wire fraud, according to the Federal Trade Commission. Nearly one-third of all 2020 wire fraud transactions were fraught with scam attempts, and 71% of funds wired to cybercriminals were not fully recovered.

Given the reliance of real estate transactions on wire transfers, real estate and title firms are increasingly becoming the targets of cyber criminals.

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Secure Your Wire Transfers

Fraudsters’ techniques for committing cyber crimes have evolved, but so have the security tools available to consumers and their agents. 

To protect yourself from wire fraud, implement these recommended actions into all of your real estate transactions: 

1. Investigate how your closing and title firm collects, handles, and facilitates the wire transfer process to confirm that it matches industry standards and includes modern security practices.
2. Learn the common red flags of wire fraud in real estate transactions. 
3. Request additional guidance from the team facilitating your wire transfer to confirm legitimacy. 
4. Utilize a closing and title services firm that leverages industry-leading wire fraud protection technology and guarantees security.

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Invest in CertifID Solutions

Recent cyber crimes point to the need for increased vigilance and security measures to keep real estate transactions safe. 

Everyone should be able to participate in wire transfers without worry. Help prevent wire fraud by educating yourself on wire fraud prevention strategies, and investing in the right security tools. 

Are you ready to fortify your real estate transactions? Contact our team for a demo of our security solutions. 

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