Strategies to Combat Wire Fraud
Multilayered Approach to Security Helps Combat Attacks
BY JEREMY YOHE
In 2012, former FBI Director Robert Mueller opined, “There are only two types of companies: those that have been hacked and those that will be.” That statement rings true 13 years later. Today, wire fraud remains one of the most pressing threats facing title and escrow companies. Fraudsters are becoming increasingly sophisticated, leveraging business email compromise, seller impersonation and even deepfake technology to infiltrate transactions.
As the threats have escalated, the types of strategies criminals use to steal funds continue to evolve. This highlights the importance of continuous training, robust verification processes and industry collaboration to protect businesses and consumers from financial loss.
“We know that real estate transactions are prime targets for fraud due to their high-value nature,” said Jewel Quintyne, senior title operations consultant at Qualia. “The numbers are staggering—$145 million in adjusted losses from cybercrime in 2023 alone, according to the FBI.”
Why Wire Fraud is a Growing Concern
Real estate transactions are attractive targets for fraudsters due to the large sums of money involved. “Just one or two fraudulent transactions can result in a huge payday for cybercriminals,” Quintyne noted.
In addition, one in four title companies reported experiencing a seller impersonation attempt in 2023, according to a study conducted by ndp | analytics. When the next report come out, it’s expected this number increased in 2024.
Nikki Pfleger, executive vice president and specialty deposits relationship manager lead at Encore Bank, highlighted another reason real estate transactions are particularly vulnerable: consumer inexperience. “These scams work because buyers and sellers don’t always know what to expect,” she said. “They trust the professionals they’re working with, and fraudsters exploit that trust.”