Real Estate Wire Fraud in Texas: How to Protect Your Closing Funds
Of all the risks in a real estate transaction, wire fraud is the one that can cost you the most in the shortest time. Scammers watch for closings, impersonate title companies or agents, and send convincing emails with new wiring instructions. Once the money leaves your account, it is very hard to get back.
How the Scam Works
A criminal breaks into an email account belonging to an agent, lender or title company, or sets up a look-alike address. They then send the buyer an email, often copying the real company's style and signature, that says the wiring instructions have changed. The buyer sends the money to the fraudster's account instead of the title company's escrow account.
Warning Signs
Be suspicious of any email that changes wiring instructions, creates urgency, asks you to keep the transfer secret, or comes from an address that is slightly different from the one you have used before. Real title companies do not change instructions by email at the last minute.
Five Steps to Protect Yourself
First, get the title company's phone number from a source you trust, such as the company's website or your contract, not from an email. Second, call that number and verify the wire instructions out loud before sending anything. Third, send a small test amount if your bank allows it and confirm receipt. Fourth, never send sensitive details such as account numbers or Social Security numbers by regular email. Fifth, if anything changes after you verified, stop and call again.
What to Do If You Suspect Fraud
Act immediately. Call your bank and ask it to recall the wire, contact your title company, and file a report with the FBI's Internet Crime Complaint Center at ic3.gov and with local law enforcement. Speed matters, because recalls are most likely to succeed in the first hours.
At Cottonwood Title, we verify wiring details by phone with every client and we will never ask you to change instructions by email. If you receive something that looks off, call our office at 281-369-6612 before you act. You can read more about how we handle residential closings and what to expect on closing day.