Why Agents Need Secure Wire Instructions

Title agents must have a secure way to send wire transfer instructions in order to have a safe and successful real estate closing process.

Why Agents Need Secure Wire Instructions

Title agents must have a secure way to send wire transfer instructions in order to have a safe and successful real estate closing process.

Written by:

Matt Kilmartin

Read time:

4 minutes

Category:

Fraud Prevention

It’s important for title agents to protect themselves, the buyer, and their agencies when wiring money.

Title agents have many important responsibilities, including finding public records on titles, preparing documents, closing home loans, issuing insurance, and distributing escrow funds. However, as the industry is evolving, so too is their role in helping to protect vulnerable buyers who may be inexperienced with real estate closings.

This is especially important as real estate wire fraud is growing more common in the U.S., making it even more imperative that agents do their part to reduce the risk as much as possible, including by providing clear wire instructions.

So how can criminals take advantage of the wire transfer process, and what role can increasing the security of this aspect of the closing play?

How does wire fraud happen?

In many instances, a home buyer emails back and forth with their real estate agent and other professionals, such as the title agent firm, when closing on a home.

Using one of many forms of business email compromise, such as phishing, criminals are able to infiltrate the conversation and then create email addresses that look similar to legitimate parties.

Cybercriminals then email digital copies of actual closing documents and wire instructions that appear real from these fake email addresses. When it comes time to prepare for and execute the wire transfer, illegitimate account information is provided by the criminals, causing the home buyer to wire money to the fraudulent party.

While this technique may seem unique, 13,638 people fell victim to wire fraud involving real estate or rentals in 2020, resulting in more than $213 million in losses, which emphasizes even more why title companies need to have secure and specific wire transfer protocols.

How can those involved protect against wire fraud?

So what steps can title companies and buyers take to fight back against this rapidly growing form of fraud? 

Fortunately, there are best practices and specialized platforms that can be employed to drastically reduce the risk and bolster the security of your real estate transaction.

Here are some of the key steps title agents and buyers can take:

  • Make sure that all wiring information is correct, either in person or on the phone, before transferring any money on behalf of the seller/buyer.
  • Never send anyone’s personal financial data, such as routing and bank account numbers, over email.
  • Be on the lookout for phishing scams. Some email messages may appear legitimate, but take the time to verify the sender and content within the message.
  • Ensure that your computer operating systems, antivirus software, and browser are current and patched against today’s vulnerabilities.
  • Remain skeptical about downloading and opening email attachments that seem out of the ordinary or are unexpected.
  • Create specific wire instructions for your title company that agents can follow to provide a consistent, secure experience.

Taking these steps—in addition to using a platform that provides end-to-end encryption during the account information collection process—can help to limit agent liability and lower the risk of potential lawsuits that could result in high financial and reputational costs.

Take the next step.

While their techniques may seem advanced, criminals that pursue wire fraud are much like any other thief: always on the lookout to make easy money. However, like in other situations, a thief would be hesitant to break into a residence equipped with alarms, security cameras, and secure gates.

If your business does its part to secure the wire transfer process, including using the necessary security protocols and advocating for the use of platforms such as CertifID, your business and customers are less likely to be targeted by cybercriminals.

Want to learn more about how to improve the security of your real estate business and protect against wire fraud? Then check out our guide to cybersecurity, Cybersecurity Measures You Can Implement To Protect Your Real Estate Business.

Matt Kilmartin

VP of Sales

Matt has over a decade of experience bringing disruptive Software-as-a-Service (SaaS) solutions to market in the automotive, MarTech, and real estate industries. He excels in high-growth tech companies with a passion for building and leading sales teams that deliver a memorable, consultative experience to prospective clients.

Getting started with CertifID is easy.

Request a Demo