Real estate wire fraud continues to be one of the most prevalent cybercrimes in the U.S. About 13,638 people were victims of wire fraud in the real estate and rental sector in 2020 (a 17% increase over 2019) with losses of more than $213 million ), according to FBI data. That ranks real estate and rental wire fraud #7 out of more than 30 types of fraud tracked by the FBI's Internet Crime Complaint Center.

The highest reported fraud in real estate in 2020 was Business Email Compromise/Email Account Compromise (BEC/EAC.) Fraudsters will assume the identity of the title, real estate agent or closing attorney and forge the person’s email and other details about the transaction. The scammers will then send an email to the unknowing buyer and provide new wire instructions to the criminal’s bank account.

Based on victim complaint data, BEC/EAC scams targeting the real estate sector continue to rise. From calendar year 2015 to calendar year 2017, there was over an 1100% rise in the number of BEC/EAC victims reporting the real estate transaction angle and an almost 2200% rise in the reported monetary loss Victims participating at all levels of a real estate transaction have reported such activity to the Internet Crime Complaint Center.[1]

[1] Business E-mail Compromise The 12 Billion Dollar ScamThu (Federal Bureau of Investigation, Jul. 12, 2018)


Real estate transactions are an attractive target for sophisticated fraud scams. In a typical scenario, cybercriminals identify a pending sale transaction and then build a profile of the parties—including the title company, real estate agents, and the buyer and seller. They hack into one or more parties’ email account and monitor email traffic for their opportunity to strike, usually sending false wire instructions that divert deposits, closing costs and even mortgage payoff funds from their intended, lawful recipient.

In a real estate transaction, wire fraud is generally purported using one of these techniques:

  • Business E-Mail Compromise (BEC) – Targets businesses working with foreign suppliers and/or businesses regularly performing wire transfer payments.
  • E-Mail Account Compromise (EAC) – Targets individuals. These sophisticated scams are carried out by fraudsters compromising email accounts through social engineering or computer intrusion techniques to conduct unauthorized transfer of funds.
  • Phishing/Vishing/Smishing/Pharming – Unsolicited email, text messages, and telephone calls purportedly from a legitimate company requesting personal, financial, and/or login credentials.
  • Spoofing – Contact information (phone number, email, and website) is deliberately falsified to mislead and appear to be from a legitimate source.

Implementing wire fraud risk management strategies will help members and associations minimize liability for losses due to fraudulent cyber schemes. And, insurance coverage may be available to help mitigate the damages of a cyberattack or wire fraud incident.

Recommended Practices:

  1. Educate buyers about possible scams. Many brokers are requiring a signed disclosure to acknowledge the risk of wire fraud.
  2. Include a wire fraud notice in your email signature. 
  3. Use a transaction management platform or secure email to communicate with clients.
  4. Never send wire instructions (or any personal or financial information) via e-mail.
  5. Verify wire instructions with a phone number independently obtained.
  6. Use smart email practices:
  • Double check the sender’s email addresses and call the sender if you’re unsure they actually sent the email.
  • Monitor your email account for unrecognized activity.
  • Keep your operating system and antivirus programs updated.
  • Avoid using unsecured (public) WiFi.
  • Never click suspicious attachments.
  • Use strong passwords for your email and all online accounts, and two factor authentication when available. A strong password generally has these characteristics:
  • At least 8 characters
  • A mix of letters and numbers;
  • A mix of uppercase and lowercase letters;
  • At least one special symbol (i.e., ! @ # $).

NAR encourages all real estate licensees to know the signs of potential wire fraud and to educate their clients about these scams. Licensees should be knowledgeable about how to advise their clients if they believe they have been victimized by a wire fraud scam, and use best practices like these.

If fraud occurs, advise your clients:

  1. Time is of the essence.
  2. Immediately contact their bank to issue a recall notice of the wire transfer.
  3. File a complaint with the FBI at ICgov. Filing within 24 hours, but no more than 72 hours, provides the best chance of recovery.
  4. Contact your local FBI office.

Learn More:

IC3 2019 Crime Report
Cyber and Fidelity Insurance Report for Brokers
Window to the Law: How Avoid Wire Fraud in Transactions
Window to the Law: Cyberscams and the Real Estate Professional
Window to the Law: Creating a Cybersecurity Program
Data Privacy and Security
Data Privacy and Security Toolkit


NAR Library & Archives has already done the research for you. References (formerly Field Guides) offer links to articles, eBooks, websites, statistics, and more to provide a comprehensive overview of perspectives. EBSCO articles (E) are available only to NAR members and require a password.

One of the most common cybercrimes in the U.S. is wire fraud in real estate. More than 13,000 people were victims of wire fraud in the real estate and rental sector in 2020, with losses of more than $213 million—an increase of 380% since 2017, according to FBI data.

Wire Fraud Card - Protect Your Money From Mortgage Closing Scams

Wire Fraud: The Basics

Wire Fraud (Investopedia, Mar. 8, 2021)

“Wire fraud is a type of fraud that involves the use of some form of telecommunications or the internet.

This type of crime can make use of any and all forms of electronic media including telephone or fax machine, email or social media, or SMS and text messaging. Wire fraud often involves communications made between state or national borders, and is punishable by both hefty fines and jail sentences.”

How Wire Transfers Work: Sending and Receiving Money (The Balance, Oct. 5, 2020)

“When you need to send or receive money quickly, a wire transfer might be the right tool for the job. Wire transfers are fast, reliable, and generally safe…Learn the ins and outs of wire transfers to wire money swiftly and safely.”

Wire Transfer Scams (Washington State Office of the Attorney General)

Common wire transfer scams are outlined.

Wire Fraud in Real Estate

How to Beware of Mortgage Wire Fraud During Closing (Rocket Mortgage, Apr. 1, 2021)

Know your closing process, write down contact information, beware of last-minute closing changes, call to confirm any wiring instructions, never email your financial information, and be wary of phone conversations.

Trends, Prevention, and Loss Recovery for Victims of Real Estate Wire Fraud and Other Cybercrimes (The Florida Bar, Nov./Dec. 2020)

“Wire fraud is a recurring cybercrime disrupting the real estate sector. The scheme often involves the compromise of a real estate professional’s email account, the interception and manipulation of electronic communications using spoof email accounts, and the delivery of fraudulent wire instructions to an unsuspecting purchaser at the opportune moment.”

Mortgage Escrow Fraud is a $1 Billion Cyber Threat – Here’s What Homebuyers Need to Know (Bankrate, Feb. 24, 2020)

“Escrow fraud preys on ignorance and hastiness as it relies on fake email accounts to execute the scam. One way this scam works is when the fraudsters hack into a title company’s system to retrieve emails and information about upcoming home purchases.”

Wire Fraud’s Impact on Homebuyers (MReport, Jun. 28, 2019)

“According to the FBI, only an estimated 12-15% of all fraud is reported, and the Coalition notes that the best way to combat these statistics is through educating the homebuyer. Homebuyers, particularly first-time buyers, are the ones who are the most at risk of wire transfer fraud.”

How to Protect Yourself from Wire Fraud

Before You Wire Money (Federal Trade Commission, May 2021)

Learn how scammers operate, common scams, what to do if you wired money to a scammer, and how to report fraud.

Hot Topics in Broker Risk Reduction (National Association of REALTORS®, 2021)

A monthly roundup of risk reduction topics by Katie Johnson, NAR General Counsel & Chief Member Experience Officer.

Protect Your Real Estate Business with NAR’s Cyber Liability Insurance Program (PDF) (National Association of REALTORS®, 2020)

CyberPolicy, in partnership with NAR, created a customized and comprehensive cyber liability insurance program designed exclusively for REALTOR®-owned firms.

Wire Fraud Notices (National Association of REALTORS®)

In an effort to educate clients about the risk of wire fraud, a number of REALTOR® associations have developed wire fraud notices for use by their members. These have been aggregated by NAR.

Wire Fraud Email Notice Template (National Association of REALTORS®)

Provides an example of a notice you may wish to consider adding to your email signature line. This notice should not serve as a substitute for educating your clients and other participants in your real estate transactions about email wire fraud.

Reports & Other Resources

Internet Crime Report 2020 (Federal Bureau of Investigation, 2020)

"In 2020, while the American public was focused on protecting our families from a global pandemic and helping
others in need, cyber criminals took advantage of an opportunity to profit from our dependence on technology
to go on an Internet crime spree. These criminals used phishing, spoofing, extortion, and various types of
Internet-enabled fraud to target the most vulnerable in our society - medical workers searching for personal
protective equipment, families looking for information about stimulus checks to help pay bills, and many others."

Legal Pulse Publication - Technology: 2018 Yearly Update (National Association of REALTORS®, Dec. 19, 2018)

Bain v. Platinum Realty, LLC, No. 16-2326-JWL, 2018 WL 3105376 (D. Kan. Jun. 25, 2018)

Purchasers wired money to a bank account controlled by an unknown party based on an email received from the real estate representative containing the wiring instructions. Purchasers asserted claims against the real estate representative for breach of fiduciary duty, negligence, and negligent misrepresentation, and sought to recover damages in the amount of $196,622.67, the amount wired to the wrong account.

Legal Case Summary: Licensee Liable for Wire Fraud Losses (National Association of REALTORS®, July, 25, 2018)

Kansas federal court upholds jury verdict that determined that a real estate licensee was 85% responsible for the buyer’s losses, which occurred when the buyer transferred purchase money to fake account after licensee allegedly forwarded email containing fake wiring instructions to the buyer.


Hot Topics in Risk Management (National Association of REALTORS®, Feb. 4, 2019)

Buyers and sellers across the nation have been targeted, so please take note and take action. Begin by alerting all clients about the potential for them to encounter this fraud. Don’t send wire instructions via email. Use secure, dual-authenticated email and transaction management systems when sharing sensitive information.

The Voice for Real Estate 93: Fraud, Rural Win, Water Rule, CARE (National Association of REALTORS®, Dec. 18, 2018)

Real estate transactions are one of the biggest targets of wire fraud. That's because the big money involved in the transactions make them tempting targets. The FBI reports that almost 10,000 people lost more than $50 million [in 2017] in real estate-related wire fraud.

Window to the Law: How to Avoid Wire Fraud in Transactions (National Association of REALTORS®, Dec. 4, 2018)

Risk management tips from NAR legal counsel.

Wire Fraud - 2017 AE Institute (National Association of REALTORS®, March 21, 2017)

Katie Johnson, NAR General Counsel & Chief Member Experience Officer presents best practices for wire fraud risk management.

Wire Fraud Alert for Buyers (National Association of REALTORS®, April 22, 2016)

NAR General Counsel Katie Johnson warns buyers about how to avoid being caught up in a wire fraud scam during the purchase of their home.


Coalition to Stop Real Estate Wire Fraud

The Coalition to Stop Real Estate Wire Fraud aims to raise awareness of wire transfer fraud and educate homebuyers, real estate and mortgage professionals, and policy makers about the urgency of the problem; provide concrete steps that people can take to prevent the risk of fraud; and identify and empower those who have been victimized to tell their story and advocate for solutions.

Fraud and Scams (Consumer Financial Protection Bureau)

The Consumer Financial Protection Bureau (CFPB) is a U.S. government agency that makes sure banks, lenders, and other financial companies treat consumers fairly. Our resources can help you prevent, recognize, and report scams and fraud.


Fraud Prevention for Commercial Real Estate Valuation (eBook)

Cyber Smart: Five Habits to Protect Your Family, Money, and Identity from Cyber Criminals (eBook)

Have an idea for a real estate topic? Send us your suggestions.

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