Can a Wire Transfer Be Reversed?

Whether you are finalizing the purchase of your new home or handling a down payment, wire transfers will be a common tool in your real estate transactions.

A wire transfer—also known as a bank transfer, credit transfer, or EFT (electronic funds transfer)—is an electronic transfer of money from one bank or credit union to another. Financial institutions use the Society for Worldwide Interbank Financial Telecommunication (SWIFT) network or Fedwire network to facilitate the process within the same bank or to another almost anywhere in the world. 

Because of the large amount of money involved and the growing use of digital tools to communicate important elements of a wire transfer, criminals are increasingly exploiting the process to intercept or redirect the funds and make off with a big payday.

We hope this never happens to you. But if it does, your first thought may be to reverse the wire transfer. Unfortunately, that isn’t always easy or possible.

Here’s what you need to know about reversing a wire transfer:

Can a wire transfer be reversed?

Every case is going to be different. But generally, the longer it has been since the official initiation of a wire transfer through the SWIFT network, the lower the chances. So your first move should be to contact your bank, the FBI’s Internet Crime Complaint Center (IC3), and local law enforcement. 

Banks, and the SWIFT system itself, may perform anti-fraud checks, verify accounts, and hold funds, meaning the process can take anywhere from 1-4 days depending on the day of the week, holidays, or if international banks are involved.

Your bank can use the SWIFT system’s Federal Reference Number to track the status of a transfer. However, once a transfer is started and accepted by the receiving bank, it is nearly impossible to cancel the transfer or have all stolen money recovered.

What resources and services are available to help reverse a wire transfer?

After contacting all the banks involved in the wire transfer and reporting the fraud, one of the participating banks may be able to freeze or recall the funds. Many criminals use banking holidays or weekends to slow the recovery process or immediately wire transfer the money to other banks, but there may be a chance to stop funds before they move again or get more information about related parties.

In addition to support from federal and local law enforcement and financial institutions, wire fraud victims have additional professional resources they can lean on. One of the most effective includes CertifID’s recovery services, which give victims access to:

• A team of fraud recovery experts
• A 24/7 crisis communication hotline
• Expedited bank account freezing
• Additional federal law enforcement engagement

How can you recover stolen funds from a wire transfer?

In 2021, only 29 percent of stolen funds from wire transactions were fully recovered, but it is worth trying. 

In fact, CertifID’s wire fraud recovery team has assisted in hundreds of successful fund recovery cases and has a much higher success rate. As of this publishing, CertifID's recovery efforts have resulted in the return of nearly $69 million to consumers and title companies.

Prevention is the best protection from wire transfer fraud.

The best way to recover from a wire transfer fraud is to prevent it from happening in the first place.

This is the mission and purpose behind CertifID’s unique platform and team of professionals. Our secure, end-to-end platform validates users’ identities before allowing the collection of wire transfer information. This process keeps sensitive financial information and wire instructions safe and out of the hands of criminals looking to ruin your real estate dream.

Want to learn more and stay on top of the latest real estate fraud prevention solutions to keep your business and customers safe? Then make sure to subscribe to CertifID’s weekly newsletter, The Wire.