Real Estate Wire Fraud: How to Protect Your Down Payment

Real estate wire fraud happens when a criminal sends you fake wiring instructions that look like they came from your attorney, title company or agent, and you wire your down payment or closing funds to the criminal's account. The defense is simple and non-negotiable: never wire money based on instructions in an email or text, and confirm every account number by calling a phone number you got in person or at the start of the deal.

If you already sent a wire you now suspect, stop reading and jump to the first-hour checklist. Speed is the single biggest factor in getting money back.

How the scam works

Most closing scams are a form of business email compromise. The CFPB describes the pattern: scammers break into, or closely imitate, the email of someone involved in your purchase, watch the conversation until closing is near, then send a message with "updated" wiring instructions. The email may come from the real person's hacked account, or from an address that differs by one letter. It uses the right names, the right property address and the right closing date, because the criminal has been reading along.

Common versions:

• "Our bank changed": a last-minute message saying the escrow account was updated because of an audit or a problem with the old bank.
• Urgency: you must wire today or lose the rate lock, the closing slot or the apartment.
• A PDF that looks official: a wiring instruction letter on copied letterhead, sometimes with a phone number that rings the scammer, who happily "confirms" the account.
• Seller-side and payoff fraud: sellers get fake instructions for their sale proceeds, and title agents get fake mortgage payoff letters.

The FBI's 2025 report includes a typical case. A couple closing on a home received an email impersonating their attorneys and wired more than $449,000. They reported it to their bank, filed with IC3, and the FBI's Recovery Asset Team asked the receiving bank to freeze the account. The full amount was still there and was put on hold. Not every case ends that way.

Read these numbers as a broad trend, not a count of closing scams alone. IC3's "real estate" crime type covers losses from real estate investments and fraud involving rental or timeshare property, and many closing wire scams are filed under business email compromise instead. They are also only losses people reported to IC3. Many victims never file, so the real total is higher.

Before you wire: the verification routine

The CFPB recommends setting up your defenses at the start of the transaction, before anyone sends you account details.

1. 1

   Pick two trusted contacts on day one

   Usually your attorney and your agent or title closer. Get their direct phone numbers in person, from your signed retainer, or from the firm’s official website you typed in yourself. Write them down on paper.
2. 2

   Agree on the money plan by phone

   Ask how funds will move (wire, certified check), to whom, and roughly when. Ask them to say out loud: “We will never change wiring instructions by email.”
3. 3

   Set a code phrase

   The CFPB suggests a code phrase known only to you and your trusted contacts, so a caller can prove who they are.
4. 4

   Verify every instruction by voice

   When instructions arrive, call your trusted contact at the number you wrote down, not any number in the email, and read back the bank name, routing number, account number and account name.
5. 5

   Treat any change as an attack

   If instructions change, especially near closing, assume fraud until you have confirmed it by phone with two people.
6. 6

   Send a small test, then confirm receipt

   Some buyers wire a small amount first and call to confirm it arrived. This helps, but it does not replace verifying the account by phone.
7. 7

   Call right after the wire

   Confirm by phone that the full amount arrived the same day. The sooner a problem is caught, the better the odds of a freeze.

Ways to cut the risk further

• Ask about alternatives. For the contract deposit in New York, many attorneys accept a check payable to their escrow account, which avoids a wire entirely. See how the contract deposit works.
• Use your bank's callback. Ask your bank whether it shows the receiving account name, and tell the banker this is a closing wire. Some banks will pause and ask questions. Let them.
• Lock down your own email. Turn on two-step login and check for forwarding rules you did not create. Criminals sometimes watch the buyer's inbox, not the agent's.
• Keep a closing checklist. Our closing day checklist has a slot for your verified contacts.

If you wired money to a scammer: the first hour

The FBI's guidance is that time is of the essence. Its Recovery Asset Team works with banks to freeze stolen funds before they are moved on. In 2025 it handled 3,900 incidents and froze about $679 million of $1.16 billion in attempted theft, a 58% success rate across all fraud types. Those freezes depend on victims and banks acting quickly.

1. Minute 0

   Call your bank’s fraud line

   Use the number on your card or the bank’s website. Say “I sent a fraudulent wire and need a wire recall.” Give the date, amount and receiving bank. Ask what indemnification forms they need and sign them right away.

2. Minutes 10–30

   File a complaint at ic3.gov

   The FBI asks victims to file regardless of the amount and to include full transaction details: sending and receiving bank, routing and account numbers, amount, date and time. Save the complaint number.

3. Within the hour

   Call your attorney and title company

   Use the numbers you trust, not the email. They can alert the receiving bank, check whether their own email was hacked, and warn the other side of the deal.

4. Same day

   Report locally and preserve evidence

   File a police report. Keep every email with its full header, the fake instructions and your wire receipt. Do not delete anything.

5. Next days

   Secure your accounts

   Change your email password, turn on two-step login, remove unknown forwarding rules, and watch your bank accounts closely.

Who is responsible if the money is gone?

That depends on the facts: whose email was hacked, what the contract and retainer say, what the parties' insurance covers and what the banks did. There is no automatic reimbursement for a wire you authorized. Talk to a lawyer who did not handle your closing if the funds are not recovered. Your purchase contract may also be at risk if you cannot close, so tell the seller's attorney immediately.

Related scams in housing

• Rental scams: fake listings that ask for a deposit before a viewing.
• Deed theft: forged deeds that transfer a home without the owner knowing.
• Moving scams: lowball estimates and held-hostage furniture.