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  • Writer's pictureJeff Sorg

5 Tips for Safeguarding Against Wire Fraud in Real Estate Transactions

Updated: Mar 11

hooded thief using laptop for cyber theft
Cyber Thief at Work

Wire fraud in real estate transactions is a cybercrime in which scammers trick buyers, sellers, or other parties involved in a real estate deal into wiring money to a fraudulent account. This can happen at any transaction stage but is most common during the closing process.

Scammers often use phishing emails to impersonate real estate agents, lenders, or other trusted professionals. The emails may contain urgent instructions to wire money to a new account, or they may simply try to steal the recipient's personal information. Once the scammer has access to the victim's personal information, they can use it to create fake wire transfer instructions or to hack into the victim's email account. This allows them to intercept any legitimate wire transfer instructions and redirect the money to their account.

Wire fraud in real estate transactions can have devastating consequences for victims. Buyers may lose their down payment, sellers may lose the proceeds from the sale of their home, and lenders may lose money on loans made. In some cases, victims may even lose their entire life savings.

Buyers, sellers, and other parties involved in real estate transactions can do several things to protect themselves from wire fraud. These include:

  1. Beware of unsolicited emails and phone calls. If you receive an email or phone call from someone claiming to be a real estate professional and asking you to wire money, be very suspicious.

  2. Do not click on any links in the email or respond to the phone call. Contact the escrow company directly by phone or email to verify the instructions.

  3. Verify wire transfer instructions carefully.

  4. Before you wire money, carefully verify the recipient's name and account number. You should also be able to call the recipient's bank to confirm that the account is legitimate.

  5. Beware of urgent requests. Scammers often use a sense of urgency to pressure victims into wiring money quickly. If someone is asking you to wire money immediately, be very careful. Legitimate real estate transactions typically do not require urgent wire transfers.

If you believe that you have been a victim of wire fraud in a real estate transaction, contact your bank immediately. Ask your bank to try to stop the wire transfer and then file a report with the FBI's Internet Crime Complaint Center (IC3). The IC3 can help you track down the scammers and recover your money.

Wire fraud in real estate transactions is a serious problem, but there are steps that buyers, sellers, and other parties involved in real estate transactions can take to protect themselves. By being vigilant and following the tips above, you can help reduce your risk of becoming a victim.


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