Statistics recently gathered by Beazley Insurance indicate that in 2017 the average theft through fraudulent wiring instructions was $357,000. Some thefts were only a few thousand dollars; however, others were in the millions.
Fraudulent wire instructions have become a significant threat to the well-being of title and closing agents. Even if your firm does not handle or wire closing funds, defrauded consumers and their attorneys may seek to involve all parties associated with the transaction.
What are you doing to prevent fraudulent wiring instructions from being followed? How are you helping potential customers feel confident that you are safeguarding their money?
Here are some risk management practices you might want to consider:
- Don’t rely on emails to receive wire instructions. Most title agencies have implemented procedures to call and verify email instructions that are received.
- If your clients’ only option is to email the wire instructions, you should first call to verify the account numbers. You should also know that talented fraudsters may be able to impersonate bank or other office personnel, so be wary.
- Make doing business with people you know a preference. While unrealistic for some, many agents manage their risk by predominantly dealing with attorneys, closing agents, and banks they know.
- Inform your clients, as many of them are not aware that fraudulent wire instructions are an issue. If they play any role in the transfer of their funds, be sure you have communicated clearly with them about this threat to their financial well-being.
Aggressively educate your staff…
Bear in mind that when fraudulent wire instructions are followed and money is lost, we all lose—even if the loss was not specifically the fault of you or your staff.
If you are concerned about having adequate protection from this type of exposure, contact one of our agents. Our proprietary E&O, Cyber, and Fidelity products provide you with some of the best protection available today.