How To Avoid Falling Prey To Wire Fraud

Wire transfer is one of the most convenient ways to send guaranteed funds quickly. For this reason, criminals have adopted sophisticated and creative ways of targeting them. According to the FBI, wire fraudsters cost businesses a staggering $3 billion annually, which is a 1000% increase in the last year alone.
More banks, small businesses, and individuals are falling victims to wire fraud. In fact, an FS-ISAC survey shows 76% of all fraud attempts are targeted at wire transfers. Preventing criminals from making you their next victim involves understanding how wire fraud is perpetrated and taking the right steps to avoid it.

How Is Wire Fraud Committed?

Wire fraud usually targets transactions that involve email communications and the wire transfer of large sums, such as real estate deals. Cybercriminals will use illegal methods to acquire pertinent information concerning, for example, the closing of a home sale. This is usually done by hacking into the email accounts of one of the parties involved such as the realtor, attorney, title agent, or lender.
Once they have obtained critical information about the sale, including names and addresses of buyer and seller, date of closing, etc., they will then hijack the proceedings when money is ready to be wired. This is accomplished by setting up fake email accounts that resemble those of the realtor or lender and sending a fraudulent email with instructions to wire money to a different account. This payment is then quickly withdrawn before anyone realizes the payment instructions were fraudulent.

How Widespread Is Wire Fraud?

The number of wire transfers has doubled in the last twenty years to 130 million, with transactions valued at a total over $600 trillion. This makes wire fraud an attractive and potentially lucrative venture for criminals. Here are facts about wire fraud you should be aware of:


  1. According to FinCen, there have been 22,000 cases of wire fraud that lead to losses of $3.1billion for businesses and individuals.
  2. Over 4000 hacking attempts are made on a daily basis according to the FBI.
  3. A 2016 survey undertaken by JP Morgan Chase showed 48% of all businesses were targeted by wire fraudsters in 2015, which represents a massive 21% increase from the previous year.
  4. The Anti-Phishing Working Group reports that over 70000 variants of computer malware are released every day leaving over 40% of all computers infected.

5 Ways To Prevent Wire Transfer Fraud


  1. Be Wary Of Email Attachments And Links: Wire fraudsters usually send phishing emails that contain attachments and links. If you click on them, malware will be installed on your computer to steal passwords, email communications, personals banking details and other sensitive information used to institute wire fraud.
  2.  Use only written and signed wiring instructions: To prevent sending money to criminals, ensure that the seller provides wiring instructions in a signed document in the presence an attorney at closing. Furthermore, assume any other wiring instructions received over email is fraudulent unless personally confirmed in writing by the seller or realtor.
  3. Verify Any Wiring Instructions Personally: If written instructions are not possible, ensure you confirm any wiring instructions by calling the realtor or seller directly. Do not dial any number included in the wiring instructions because criminals often provide a false contact. Instead, call the official realtors’ or lender’s number as listed in the directory.
  4. Beware Of Free Email Accounts: Criminals often use free email accounts such as Gmail, Yahoo, Hotmail, or AOL to duplicate or mimic official corporate email addresses. Any email sent from a free account should be treated as fraudulent unless verified personally over the phone.
  5. Watch out For Unusual Requests: If you find any request suspicious, trust your instincts and verify it before sending any money. This is especially true if you are asked to wire money urgently, or if the email requests secrecy. You should also beware of sending money to accounts that do not bear the title agents name, or if the bank account is based overseas or in a different geographical location.

Conclusion: Losing vast sums of money through wire fraud is easy. However, the damage does not stop there; most cases of wire fraud involve costly investigations, litigation, remediation, loss of brand reputation as well as customer backlash. Taking these prudent steps can protect you from a potentially damaging wire transfer scam.