Wire Transfer Fraud: How to Prevent Losses with Funds Recovery

How does wire transfer fraud happen?

Although there are some edge cases, most wire transfer fraud follows a pattern. 

First, criminals identify parties—typically title companies, real estate attorneys, or real estate agents—and then utilize a method of business email compromise to force themselves into the legitimate wire transfer process. 

Whether it’s a phishing message to collect credentials or an impersonation of a legitimate business email account, these criminals use this access to reroute the data collection and confirmation processes. Then, they replace the real account information with their own as the parties prepare for closing, and confirmations go to the buyer or seller. 

After closing, the funds are sent to the criminal’s account before quickly being transferred to other accounts. This last phase often occurs rapidly, as the fraudsters attempt to prevent traceability and funds recovery.

What does wire transfer fraud recovery entail?

If you are the victim of wire transfer fraud, there are key steps you should take as soon as possible:

‍Initiate a “SWIFT recall“ on the wire transfer.

‍The SWIFT process, which is used to track and verify money transfers between bank accounts, often has set times and logs that can be used to your advantage. While fraudsters attempt to use a long chain of banks to make it difficult to track down the funds, initiating a SWIFT recall can put a stop to any further movement of the money, if done in time. 

That’s why it’s essential to contact all banks involved in your transaction and report the event because they may be able to freeze or recall funds before they are moved or provide vital information about movements recently made.
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‍File a complaint with the FBI’s IC3.

‍Although not guaranteed, the FBI can start a funds recovery process for you using similar mechanisms to track the movement of funds. 

After contacting your banks, contact the FBI’s Internet Crime Complaint Center (IC3) to file a formal complaint. Once you provide the necessary information about the scam, you will be given a complaint number. 

Then, take this number to your local FBI office and report the details once again. You should also contact your local police department to file a report. 

Initiate your incident response process.

‍If you are a title company or agent, you need to initiate your incident response process as soon as possible to find the source of the breach and determine if other transactions—pending or completed—have been affected.

You will also need to determine if the criminals accessed any other systems or databases.

How can you bolster the security of your wire transfer process?

Want to move away from email exchanges and take the security of your wire transfer process to the next level?

That’s what CertifID is designed for.

CertifID integrates with your existing title production platforms. Once integrated, it seamlessly and securely captures wire transfer account information by verifying the authenticity of each user and enabling end-to-end encryption.

Want extra peace of mind? All transactions processed via CertifID’s platform are insured by Lloyd's of London by up to $1 million. Every customer also has 24/7 access to CertifID’s experienced professionals if they ever have a question or concern.

Take the next step.

Even one instance of wire transfer fraud is more than what is acceptable. 

To avoid fraud and protect your consumers, you need a powerful platform like CertifID, which provides the security and support that these important transactions deserve.

If you are ready to do your part to protect your business and put these criminals out of work, then contact the team at CertifID to get a personalized demo of our industry-leading software.

Want to learn more? Take a moment to review our latest resource, The Wire Fraud Prevention Guide, now.

When you are on the other end of wire transfer fraud, it’s devastating to all those involved, whether you’re a buyer, a seller, an agent, or a title company.

However, with the rise of digital platforms and increased remote access, real estate wire fraud is becoming a common crime. In fact, according to one FBI report, wire transfer fraud losses hit more than $220 million in 2020, a 13 percent increase from the prior year.

So what can you do when scammers target your real estate transaction? That’s where wire transfer fraud recovery comes in.