How Hackers Use Email To Commit Wire Transfer Fraud

How Hackers Use Email To Commit Wire Transfer Fraud

There is seemingly no end to the dirty tricks that hackers will use to separate you from your money or personal data. Every time you turn around, it’s another new cyber-attack cropping up to plague humankind. You’ve probably heard of many common forms of attack, like phishing or ransomware, but a lot of people don’t think about the risk of wire transfer fraud. Cyber-criminals, preying upon this fact, are beginning to target this kind of transaction more often. Let’s assess the problem and see what we can learn.

How Do These Wire Fraud Scams Work?

The idea behind this type of scam is a simple one: Pose as a legitimate business associate to trick people into wiring funds. This can be done in a number of ways, but real estate seems to be the most common target. That makes a lot of sense because the sale of a home generates a lot more money than the average consumer transaction. Surprisingly, in these cases, the criminals usually don’t steal all the money from the sale. Instead, they target smaller sums in the form of closing costs.

Whenever someone buys a home, they have to pay a certain amount to the real estate agent. These are the costs of closing the deal and are usually referred to as “closing costs.” Although these sums are collected by your real estate agent, they will mostly go to the lender for various transactional fees. While these sums are nowhere near the total value of the home, they are still pretty large.

So, here is what they do: They impersonate your real estate agent and send you a spoofed email. Real estate agents tend to be pretty public with their information, and it’s not hard to obtain an official email from one. From there, the hacker just has to do a little alteration and it’s “game on.” While impersonating your real estate agent, they will direct you to send the closing costs to a certain bank account. By the time the sender realizes what has happened, it is too late. The money will normally be shunted to offshore/overseas accounts within hours, making it virtually impossible for even federal authorities to recover.

How Much Money Do These Scammers Get?

According to this article, the average closing costs (for the buyer) are 2-5% of the total sale. For the seller, those costs will be more like 8-10%.

According to this figure (from the same source as before), the median home price in the United States (for 2020) is $262,604.00. That means the closing costs for buyers (on average) will range between $5,252.00 and $13,130.00. For sellers, it will range between $21,008.00 and $26,260.00. As you can see, those are pretty significant sums of money.

A Typical Scenario

To get a better idea of how these things work (and how to avoid them), let’s look for a real-life example of this type of attack. We were able to find this one, although the intended victim did manage to avoid the scam. The author says that she was just about to close on a house when she got a message from someone claiming to be her escrow officer. She was told that the closing costs would have to be wired right away in order to avoid pushing back the date of the sale.

The email looked legitimate at first glance, but the victim noticed something funny when looking at the addresses. All three of them were one letter off, Which instantly triggered alarm bells in the intended victim’s head. We can see several interesting facts here:

  • The scammer tried to create a sense of urgency with a false problem
  • The spoofed email addresses were only changed by one letter
  • The fake email was duplicated near-perfectly (except for the addresses)

According to this FBI report, real estate fraud of this sort is very common. The report dates from 2018 and states that Americans lost about 150 million dollars as a result of these scams. It also talks about how real estate has become a much more frequent target in recent years.

Preventing Mortgage Wire Fraud Scams

As we can see from the example given above, vigilance is by far the best defense. This is a good example of “social engineering hacking.” Instead of trying to push their way past the digital defenses, the attacker goes after the victim on a mental level. If you can’t trick the tech, you attempt to trick the user.

The first thing to understand is this: Never wire a large sum of money in a hurry. That is precisely what the hackers want you to do, which is why they will always try to create a false sense of urgency. They will probably do everything in their power to make you believe that the payment must be made right away in order to avoid losing your house. They want you to react with panic and send the money before you have time to think about what you’re doing.

If you get an email of this type, here are the things you should do:

  • Check every detail of the email, including the addresses, to verify the authenticity
  • Call the alleged sender of the email on the phone to verify their identity
  • Do NOT click on any links that might be provided in the email

Simple phone confirmation is the easiest way to verify an email of this kind. Lenders and real estate agents don’t normally change terms and suddenly ask for money out of the blue. If you make the call and your agent doesn’t know anything about the matter, that email is a scam.


If you would like to know more about cybersecurity in general, you can call PCH Technologies at (856) 754-7500. We offer small business computer support and all sorts of other services. We hope that this information will help to make you a little bit safer and that you have enjoyed reading this article.