A Tip for Wire Fraud Prevention

Title companies, brokers and lending institutions are being cautioned that scammers are increasingly targeting them by sending forged emails to their clients instructing that funds be wired to accounts controlled by the scammers. The forged emails originate from an address that appears to be from a legitimate sender, but uses a similar, but slightly altered domain name.

The scammers monitor a compromised email account (it could be the client’s or even the financial institution’s) and uncover pending or upcoming transactions requiring an outlay of funds, such as a real estate purchase or a loan. When the party holding the funds is expecting the request for funds, the scammers send instructions to wire the funds to accounts controlled by the scammers. The funds are immediately swept from the account and the scammers vanish.

We recently represented a title company who was sued by an elderly couple. The couple was refinancing their home. They received an email that appeared to come from the title company asking them to wire a payment. The company name was misspelled and the body of the email, to anyone looking closely, contained other misspellings, but the couple did not notice them. The couple wired funds to a bank, never to see them again. Of course, the title company was not liable and we successfully had them dismissed from the lawsuit, but not before they incurred fees to compel the dismissal. The couple lost a significant amount of money and law enforcement was unable to recover it.

What to do:

  • Be on the lookout for wire fraud scams.
  • Caution your clients not to open an email that looks similar, but not exactly like the sender’s.
  • Consider using warnings in your email signature lines such as:

WARNING – FRAUD ALERT:  Hackers are targeting the e-mail of parties involved with real estate transactions, business transactions and settlements in attempts to distribute fraudulent wire instructions. If you receive an e-mail appearing to be from our office requesting that you wire, or transfer funds, confirm all wiring instructions by phone directly with our office before transferring funds. Be certain you are speaking with someone from our office when confirming wire instructions. VERIFY OUR TELEPHONE NUMBER FROM A SOURCE OTHER THAN THE PHONE NUMBER ACCOMPANYING THE E-MAILED WIRE INSTRUCTIONS.