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Cyber Criminals Are Targeting Home Buyers and Sellers

Updated: Aug 23, 2022

When my wife and I sold our house in Westfield, NJ in 2017, our $239,000 mortgage payoff was stolen. The money was never recovered from the criminals.

We were victims of real estate wire fraud.

I’m not only a victim, I’m also a real estate agent and lawyer. And shame on me for not knowing about wire fraud when I sold my house.

Shortly after I sold my house, a client of mine was also targeted by criminals and my client came very close to losing their $225,000 down payment.

After this occurred, I vowed to learn about wire fraud and educate my clients and other real estate agents about the problem.

Over the past five years, I have written about wire fraud prevention and educated real estate agents around the US. I sat on a wire fraud panel with a U.S. Senator, participated in a roundtable discussion with the FBI, and was interviewed and quoted by the Wall Street Journal and other publications.

Unfortunately, real estate wire fraud is still unknown to most consumers.

There is not an effective consumer education program and there are no bank wiring safeguards in place to ensure home buyers and sellers are safe from scammers.

Also, real estate agents are not required to discuss wire fraud with their clients. Instead, brokerages and Realtor associations have clients sign wire fraud disclosure forms. These are ineffective.

Real estate wire fraud is becoming more prevalent. According to the title industry’s trade association, ALTA, one in three real estate transactions are targeted by wire fraud criminals. Wire fraud experts estimate that the average real estate wire fraud loss is $360,000.

If you are in a real estate transaction or about to buy or sell a home, here is how your money could be stolen and what you can do to protect yourself.

Home Buyers

As a buyer, you will pay a deposit and down payment if you're getting a mortgage. If you are a cash buyer, you will pay a deposit and then the balance.

If you wire payment to your attorney’s office, title company, or settlement agent, there’s a risk that the money could be diverted to a criminal’s account.

This could occur if a criminal successfully hacks into an email account of someone in your transaction. It could be a real estate agent, someone in the lawyer’s office, or the title company.

The hacker would track the emails and look for wiring instructions. If they find it, they will create a fake copy and insert their bank account number where the funds will be deposited.

The fraudulent wire instructions would be emailed to you from an email address that is similar to one of the parties in the transaction. Unless you scrutinized the email address, it's unlikely that you'd recognize that the wiring instructions were fake.

If you wire your money into a criminal’s account, the odds of recovering it are slim.

Home Sellers

As a seller, your proceeds will be wired into your bank account by the title company or settlement agent. Several days before the closing, the title company, settlement agent, or attorney will ask you to provide wiring instructions for your proceeds. After you get wiring instructions from your bank and email this information, you are exposing yourself to wire fraud.

Here’s how your proceeds could get stolen.

If criminals successfully hacked into an email account of someone in your transaction, they would see the wiring instructions for your proceeds. They would change the account number to where the funds will be deposited and email the fraudulent wiring instructions to the person who will wire the funds. Their email address would be similar to your email or your attorney's email.

Not only is a seller's proceeds at risk, so is the mortgage payoff.

Mortgage balances are paid at closing and are usually sent by wire.

Before closing, you will be asked to contact your mortgage bank and obtain a mortgage payoff letter. The letter will include the mortgage balance and wiring instructions.

If hackers obtain the payoff wiring instructions, they will change the account number from your mortgage account to their bank account. They will then send the wiring instructions to the party who requested it. That may be your attorney, someone at the title company or settlement agent. If the money is wired into the wrong account, it is unlikely that it will be recovered.

Be Vigilant and Get In Front of the Issue

Be suspicious! Sophisticated and well-capitalized criminals are working diligently to insert themselves in your transaction to steal your money.

  • Talk with your real estate agent about wire fraud. Tell them you want to make sure everyone in your transaction takes proper precautions to prevent wire fraud.

  • Ask your agent to contact the title company to find out how they will ensure that your wire transactions are safe from hackers.

  • Talk with your attorney about wire fraud and find out how they ensure safe wires.

If you prefer to pay or receive a check instead of a wire, tell your agent to inform all parties that this is your preference and any wire instructions allegedly from you should be assumed to be fraudulent. If you change your mind and decide you want to use a wire, call and email your agent and attorney.

How to Safely Send and Receive Payment By Wire

Never trust contact information in unverified emails. Confirm that the sender is someone in your transaction and call them on a phone number that you independently verified. Don't assume that the phone number in the email is legitimate.

Immediately before wiring the money, call the intended recipient to verify the account number where the money is being wired.

Ask the recipient to call you as soon as they receive the funds.

Sellers with mortgages should call their mortgage company after the closing to verify the mortgage payoff wire was received. The seller should continue following up until they are told the wire was received. This may take up to 24 hours during the business week.

If Your Wire Payment Was Stolen, Act Quickly

  • Report the fraudulent wire transfer to the sending and receiving banks.

  • Contact the sending bank’s fraud department and initiate a swift recall on the wire. Request a recall of the wire be sent to the receiving bank. Provide the wiring details and ask the bank to alert all other banks that may have received your funds to place a fraud alert or security hold on the funds so they’re not withdrawn or transferred to another account.

  • Have the bank initiate the FBI’s Financial Fraud Kill Chain.

  • Report any fraudulent activity to the FBI via its Internet Crime Complaint Center – and call your local FBI field office to assist in the recovery of your funds.

  • Contact your real estate agent and attorney. Tell them to inform all parties in the transaction of the fraud, including the title insurance carrier.

If you are buying or selling a home, do not assume that real estate agents, attorneys, title companies, and settlement agents are doing everything possible to protect you from wire fraud. Educate yourself and take proper precautions. Remember, it's YOUR money that is at risk.

If you'd like more information on real estate wire fraud, contact me at



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