Wire Transfer Fraud: Protect Your Title Company

You probably know someone impacted by bank wire fraud, especially if you work in real estate. In fact, title companies face wire fraud risks in 1 out of every 20 transactions (State of Wire Fraud Report).

For businesses sending money transfers regularly, the stakes are high.

If your title company or law firm mistakenly wires funds to a fraudulent account, you could be left footing the bill. Handling a wire transfer scam, court fees, and damage to your reputation can be overwhelming, making prevention your best defense.

But first, a key part of protecting yourself from wire transfer fraud is understanding it.

In this article, you will learn about wire transfer fraud, how to prevent it, and how to recover money if you become a victim.

Understanding wire transfer fraud

What is wire fraud?

Wire fraud is a cybercrime in which a scammer uses digital means to trick someone into wiring money to a fraudulent account. 

Most often, it’s done through email or phone calls. However, the rise in artificial intelligence and deepfake technology has made social media and video core tactics in recent years.

The key to a fraudster’s wire fraud tactics is to get into someone’s email or database through phishing or other forms of social engineering. 

Their goal: gather sensitive information, manipulate details, and steal the funds.

Why title companies are prime targets

In real estate, wire fraud occurs when fraudsters pose as trusted parties—agents, buyers, sellers, or lenders—to intercept funds during a transaction. 

When you started your title business or joined a firm, wire fraud protection likely wasn’t at the top of your list. 

But in today’s environment, it needs to be. Why? Fraudsters target you for a few key reasons:

• There’s big money to be made. The transaction value of a home has risen exponentially in the past few years.  Real estate deals involve large sums of money—perfect for a big payday.
• There’s pressure to move fast. Fraudsters win when someone makes a mistake. In a real estate transaction, speed is part of the deal. The pressure to close quickly can force people to skip over otherwise secure wire transfer protocols. This creates vulnerabilities that expose you to fraud.
• There are industry gaps. With the size and scope of the real estate industry, change takes time. Fraudsters know this and target any sector with weak infrastructure and lax cybersecurity.

As a title professional, you also sit at the nexus of real estate transactions, managing the flow between buyers, sellers, realtors, and lenders. 

Your access to money and people makes you a prime target for wire transfer fraud. This central role puts you in the “eye of the storm” for fraud. And when multiple parties are involved in every transaction—that means more risk.
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In addition, clients want convenience. Your customers want seamless transactions but aren’t aware of the lurking risks. Have you ever felt rushed to close a deal? You can see where the cracks in security begin to show.

Consider how easy it is to become a victim of wire fraud with each person involved in these transactions.

• Buyers: Fraudsters can intercept cash-to-close payments.
• Realtors: Fraudsters can pose as a seller to commit seller impersonation fraud.
• Sellers: Fake wiring instructions could divert net proceeds.
• Lenders: Mortgage payoffs are vulnerable to fraudulent instructions.

Every transaction is a high-stakes game—one slip, and the money's gone. 

Fraudsters keep getting smarter, so title agents like you need to stay sharp. Protecting each step of the process protects the whole deal, and your reputation too. 

If you're ready to safeguard your transactions with a proven wire fraud prevention solution, we're here to help. Contact us today to see how we can protect your title company.

If you want to learn more about bank wire fraud and how it affects title agencies, keep reading. We have real examples for you. 

How wire fraud happens: real-life scenarios

To defend against wire transfer fraud, you need to understand how these schemes work. Fraudsters are creative, and they’ll exploit every weak link in the process.

Here are some real-world examples of the methods they use to deceive title agents, buyers, and sellers—and how easily a single misstep can lead to major losses.

Compromise email attacks

According to the FBI IC3’s latest analysis, over $2.9 billion in reported losses were due to a compromise email attack or business email compromise (BEC). In fact, most forms of real estate wire fraud involve some form of BEC.
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Here’s how it often occurs in real estate:

First, fraudsters hack into a realtor’s or broker’s email accounts via social engineering.

Once inside, they monitor ongoing transactions and gather crucial details like who’s managing the funds and what bank accounts it’s going to.

At the last minute, they send “updated” wiring instructions. These come from a fake email address that looks very similar to the real one.

By the time anyone realizes the mistake, the money—and the fraudster—is gone.

Example: Take, for example, the story of Rana Robillard, a cybersecurity executive, who was tricked into sending $398,359.58 to a fraudster posing as her title company. 

As the closing day approached, Rana received an email guiding her to wire funds to a JPMorgan Chase account. She didn’t realize she had been tricked until days later. A similar request came from her real title company.

She spent months trying to recover her funds. Unfortunately, she also lost the house in the process.

Business email compromise happens every day to hundreds of people like Rana across the United States. Stay alert and use bank wire fraud prevention tools to protect your business. This way, you can keep your transactions safe and maintain your clients’ trust.

Seller-side fraud scenarios

One of the fastest-growing forms of wire transfer fraud in real estate is seller impersonation fraud.

Seller impersonation fraud occurs when a fraudster poses as a property owner and attempts to list and sell the property to get the funds. Usually, the real property owner is out of state or overseas and not regularly checking up on their lot.

All the information the fraudster needs to commit this type of fraud is easily found in public county tax records. 

After they’ve picked a property, and convinced a real estate agent to list it on their behalf, it’s just a matter of waiting for someone to buy it. To ensure that happens, they’ll typically drop the sales price low and ask for cash-only deals so it closes faster.

Once the deal closes, the fraudster will move the funds and disappear. The real owner is left to discover the fraud the next time they check on the property.

Example: One of the most notorious cases of seller impersonation fraud happened in Fairfield, Connecticut in 2023. 

A half-acre vacant lot was purchased and sold to a legitimate buyer, who began construction on a new home on the vacant lot.

The twist? The seller was fraudulent.

Dr. Kenigsberg, the real owner from Long Island, found out about the fraud when he got back home. He also discovered a new house on his family property.

A lawsuit was filed, and ultimately, he and the buyer settled.

We spoke with Anthony Monelli, the closing attorney in this case, in a recent To Catch a Fraudster webinar about the experience.

His suggestion to avoid seller impersonation fraud: “If anyone tries to rush you through the process, tell them ‘Stop, no, I’m verifying it.’” 

For more tips on preventing seller impersonation fraud, check out our best practices.

Down payment and closing fund interception

Another particularly nefarious form of wire fraud is down payment fraud—or buyer-side fraud. 

What happens: Fraudsters impersonate the title agency and send fake wiring instructions to buyers, urging them to transfer funds early.

This occurs often with first-time home buyers, who aren’t familiar with bank wire fraud and are eager to close. However, seasoned home buyers are equally likely to fall victim.

It’s not often until the closing table that all parties realize there’s been funds stolen.

Example: We worked to recover $297,778 for a home buyer, Luana, earlier this year. 

Luana and her husband were closing on a new home in Utah.

They received an email from their title company (see: a fraudster), informing them that cashier’s checks were no longer accepted; they needed to make a bank wire transfer to complete the process.

At first, they were suspicious, as they were planning on mailing a cashier’s check later that day. They contacted their real estate agent to confirm. To their surprise, the agent confirmed the updated payment process.

Convinced by both parties, Luana’s husband traveled to the bank and wired the funds. However, just as he sent the funds, he noticed a “wire fraud alert” notice on the teller’s counter. To confirm, he checked the phone number that was included in the updated wiring instructions. It was then he discovered it was all a scam.

The fraudster had impersonated both the title company and the real estate agent.

Luckily, we were able to recover the funds for this couple, and they closed on the home. Still, many others aren’t so lucky.

Mortgage payoff interception

One of the most prominent forms of real estate wire fraud is mortgage payoff fraud. 

Scammers can intercept messages between title agencies and banks. They send fake payoff statements with wrong wire details. They may also create fake lender websites with incorrect wiring information.

Our Fraud Recovery Services team has seen a dramatic increase in the number of mortgage payoff fraud reports in recent years. 

Example: Consider the experience from the perspective of Thomas, an attorney who had been practicing law for 25 years. 

“We’re a small, family-owned firm and we strive to take care of our clients,” he said.

Just before Thanksgiving, while most of the staff were out of the office, he got the call that a $233,000 mortgage payoff hadn’t landed at the lender’s bank despite being wired three weeks prior. 

What his team didn’t know at the time was that the wire instructions received were spoofed. 

The firm unwittingly sent the mortgage payoff to a cyber criminal’s bank. The fraud was only discovered weeks later when the firm was asked about the lender's late mortgage payment notice.

By the time they discovered it, the fraudsters had already stolen $1.2 million in funds.

Our Fraud Recovery Services helped recover a large amount of Thomas' lost money. However, the damage was done, and he learned a tough lesson about verification.

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Internal process exploitation

An important piece of all of these types of fraud is the fraudster’s use of urgency.

In these cases, the fraudsters took advantage of rushed closings, weekends, holidays, and new employees. They used these situations to sneak fraudulent instructions past verification checks. 

They rushed buyers with stories about “losing their homes,” and told real estate agents “the lot must sell fast” to motivate the agent on a seller-side fraud attempt.

Verification could have prevented it. To avoid becoming a victim of bank wire fraud, you need to create steps that slow you down. These steps will help protect your transaction.

How to avoid becoming a victim of wire fraud

While knowing how fraudsters operate is important, it’s only the beginning. 

To truly protect your business, you need a proactive approach that combines education, secure communication, verification processes, and constant vigilance. 

By strengthening these areas, you can build a strong defense. This keeps your transactions safe and helps your business stay ahead of scammers.

Take a look at five ways to protect you and your business from wire transfer fraud.

1. Education and training

Education is your first line of defense. Train your employees to recognize the subtle signs of fraud. Suspicious emails, last-minute changes, and urgent demands should all raise red flags. 

Fraud tactics are constantly evolving, so make sure your training evolves, too. Share examples of recent fraud schemes to keep your team informed. 

The more familiar they are with the tricks of the trade, the harder it becomes for scammers to succeed.

2. Secure communication channels

Email may be convenient, but it’s a playground for fraudsters. Avoid using it for wiring instructions. 

Instead, rely on encrypted platforms or secure portals designed for sensitive information. When you receive wire instructions, always confirm them through a secure solution like CertifID. 

A quick verification call could be the difference between a successful transaction and a catastrophic loss.

3. Multi-factor authentication 

Adding multi-factor authentication (MFA) to your systems is a simple yet powerful step. 

MFA makes it harder for scammers to gain access to your accounts, even if they manage to steal a password. 

Implement MFA for both internal systems and any external communications. 

It’s a small inconvenience that adds a layer of security.

4. Verification processes

The most important thing you can do is verify your wiring instructions. 

Every wire transfer should go through a rigorous verification process. 

Tools like CertifID’s Send, Confirm, and Collect help you verify wire instructions easily. You can avoid the back-and-forth of traditional callbacks. 

For mortgage payoffs, PayoffProtect ensures that the funds go to the right place.

These tools streamline verification while keeping transactions secure.

5. Staying vigilant

Fraudsters thrive on urgency and confusion. If you receive a last-minute change or an urgent request, pause and verify. Trust your instincts—if something feels off, it probably is. 

And remember: Be especially cautious during high-risk times like weekends, holidays, and the end of the month when transactions are rushed. 

A moment of vigilance can save your company from disaster.

What to do if you get scammed

Even with the best safeguards in place, fraud can still happen. 

After you realize you’ve been scammed, every second counts. Recovery is possible, but difficult. Action can mean the difference between recovering your funds and losing them forever. 

Here’s how to mitigate the damage if you become a victim of wire fraud.

1. Act quickly

Time is your most valuable resource when fraud strikes. As soon as you discover the scam, take immediate action.

• Notify your bank: Contact your bank immediately and request a “SWIFT” recall on the wire transfer. Banks have limited windows to stop or reverse wire transactions, so speed is crucial. Make sure you have all the information about the transaction including the sending and receiving bank numbers.
• Time is money: The faster you act, the higher the chances of recovering your funds. Delays, even by a few hours, can give fraudsters time to move the money beyond reach.

2. Report the fraud

Once you’ve contacted your bank, the next step is to alert the appropriate authorities. Reporting the bank wire fraud helps initiate investigations and increases the likelihood of recovery.

• Law enforcement: File a report with your local police department. Provide all relevant details, including emails, wire instructions, and any communication with the fraudster.
• FBI: Submit a complaint to the IC3 portal. The FBI’s Internet Crime Complaint Center specializes in cybercrime and works to track down fraudsters.
• CertifID Recoveries: Use CertifID’s Fraud Recovery Services. Our team works with the Secret Service and other authorities to help recover stolen funds. To date, we’ve recovered over $80M+ in funds across over 300 cases.

Here are some additional tips on using the support of law enforcement agencies to recover funds faster.

3. Evaluate and strengthen

After the immediate crisis has passed, review what happened and fortify your processes to prevent future incidents.

• Post-mortem: Conduct a thorough review to identify where the breakdown occurred. Did someone miss a red flag? Was there a lapse in communication or verification? Be on the lookout for loopholes in your processes that may have caused the fraud.
• Close the gaps: Use the insights from your review to strengthen your security. Update training programs, tighten verification processes, consider phishing tests, and invest in fraud prevention tools like CertifID to minimize risk.

Wire transfer fraud: learn and move forward

Fraud incidents are painful, but they can also be valuable learning experiences. You can turn a setback into a foundation for stronger security. 

Recovery can be very challenging, but it is possible. After three harrowing wire fraud incidents over a few months, Sarah Dombrovski, owner at Unique Title, was able to recover a significant portion of her funds.

Remember, the goal is not just to recover but to ensure your company doesn’t fall victim again.

Wire transfer fraud: stay one step ahead

Wire transfer fraud isn’t going anywhere, and the risks are real. 

But with the right tools and strategies, you can protect your business and your clients. From educating your team and securing communication channels to verifying wire instructions and staying vigilant, these steps give you a fighting chance against fraudsters.

The good news? You’re not in this alone. With solutions like CertifID, you can stay one step ahead.

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