Verify Escrow

Escrow Fraud: How it Works

Congratulations! You’ve found your dream home! The closing date is fast approaching and you can almost feel what it’s like to actually live within those four walls when out of the blue, you receive an urgent email from your real estate agent. The email includes a new wire address and a set of instructions to wire your down payment. Maybe your agent mentions an excuse for the unexpected change and it might seem innocent, but did you check the email address that sent you the email?

For victims of escrow wire fraud, these emails came from scammers posing as their agent. And their stolen funds? Those went directly into the scammer’s pocket. Scammers pose as anyone they can to defraud their victims, often posing as individuals that the victim is likely to trust such as their escrow company, real estate agent, or even workplace supervisor. Regardless of who the scammer pretends to be, the real victim of these crimes is the consumer.

The Solution: The Call-Click-Confirm Method

There isn’t one single solution for every victim of escrow fraud, unfortunately, all cases are different and many victims find that they were unprepared. The best way to prepare yourself if you are in the process of buying a home is to learn about the Call-Click-Confirm Method.

The Call-Click-Confirm Method Explained

The Call-Click-Confirm or CCC method is designed to help you verify any wire instructions given to you by your escrow company, or who is pretending to be your escrow company. This method is easy to remember because the order of the three C’s is the order in which the method is performed.

Attention to Realtors and Sales Agents: Consider adding the Call-Click-Confirm Method as a “Best Practice” recommendation for your clients.



your escrow company as soon as you receive any wire instructions. Even if it looks like the communication came from your escrow company, call them directly to verify the address and to verify that they in fact sent that communication.



to wire a very small amount of money as a test, but no more than $50. Do not send the full amount on the first transfer. If the address is in fact fraudulent, you may not be able to recover the stolen funds.



with your escrow company that they received the amount you sent to the exact wire address. Once this is confirmed with your escrow company, you can then wire the remaining funds. TIP: best practice is to always call immediately to confirm receipt of funds after sending them via wire transfer.

7 Most Common Types of Escrow and Wire Fraud

The Pseudo Seller

Posing as the seller, the scammer will contact the settlement agent with fraudulent instructions to wire the seller proceeds to a new address. The scammer can then steals the seller’s proceeds.

Last-Minute Changes

Posing as the seller around the closing date, the scammer will contact the real estate agent with fraudulent instructions to wire the seller proceeds to a new address. The scammer can then steals the seller’s proceeds.

The Refund

Posing as the real estate agent, the scammer will contact the settlement agent requesting that earnest money be sent back to the buyer and fraudulent instructions. The scammer then steals the earnest money from the buyer.

The Down Payment Transfer

Posing as the real estate agent or settlement agent, the scammer will contact the buyer with fraudulent instructions and an address to wire their down payment amount. The scammer can then steal the down payment funds.

The Fake Investor

Posing as the seller around the closing date, the scammer will contact the real estate agent with fraudulent instructions to wire the seller proceeds to a new address. The scammer can then steals the seller’s proceeds.

The White Collar Scam

Posing as a top executive in a company, the scammer will contact employees whose duties are to transfer funds with fraudulent instructions for a new transfer method. The scammer can then steal any funds that are transferred.

The Unpaid Vendor

Posing as an unpaid vendor, the scammer will contact a company with fraudulent instructions to wire funds to settle an unpaid invoice. The scammer can then steal any funds that are transferred.

Identifying Escrow Fraud

Most people don’t think they’ll ever be a victim of escrow fraud, yet millions of dollars each year are swiped from consumers. Scammers are sneaky and rely on consumers to blindly trust the communication being sent to them. Keep reading to learn how to identify escrow fraud before it can occur.

Check the sender’s email address

Scammers are notorious for conducting scams through email. Scammers are able to hack into the email accounts of your escrow company and steal information about upcoming transactions. If you’ve received an email and you’re unsure of its validity, contact your escrow company immediately. Ask them to confirm they sent you the email, the contents of the email, and the address it came from. Sometimes scammers will simply change a letter in their email address to look like another.

For example
Actual Email            Scam Email

At a quick glance, the email address may look like the agent you’ve been communicating with, but by looking closer you can see that there is a slight typo in the second email.


Don’t call any phone numbers provided in emails

If you think you’re being scammed, your first instinct may be to call and confirm with your escrow company and that is exactly correct. However, don’t click on any phone numbers within the email you’ve received. Scammers are able to spoof phone numbers meaning that the phone number provided looks like your escrow company’s, but it actually directs to the scammer. Scammers are often waiting patiently by the phone, ready to answer the call pretending to be your escrow company to bring you false peace of mind

Be aware of emails creating a sense of urgency for your transaction

Scammers may create a false sense of urgency to encourage the consumer to act quickly in hopes that they believe the validity of the transaction. Scammers may send emails with subjects similar to:
“URGENT NOTICE: Final Instructions for Closing Funds”
The use of capital letters and the word choice of this line are designed to create a sense of urgency with the buyer to finalize their transaction. However, if you have a reputable escrow company, they will never send you instructions for any wire transfer via email.

Be aware of sudden changes to your transaction

Not all transactions require money wiring. If you’ve made a plan with your escrow company or real estate agent to write a check, be very suspicious of any emails stating that you must now wire your funds instead. Always call and confirm any details with the company you’re working with. If you haven’t discussed this previously with your agent, do not send funds until it is confirmed to be a valid request.

Answer phone calls with caution

Call spoofing is a method used to disguise a phone number as a different number. In this case, the number of your escrow company. While it looks valid, pay attention to what the person on the other line is saying. They may say they have new and urgent information for you about your transaction, but first, they need you to verify your personal information. Red flag! Your escrow company already has your information and likely has kept you up to date with your purchase. Don’t give them your personal information. Tell the caller you’d like to verify this call for your safety, hang up, and dial the number provided to you by your escrow company. They will be able to verify if the call was legitimate or if it was fraudulent.

The bottom line is: trust your gut

Scammers are trying to be subtle and they’re relying on consumers overlooking the little details. Remember, it’s extremely unlikely that wire instructions will be sent to you via email or phone in the first place. Scammers are hoping that you’ll stay uninformed and naive, stay educated and prove them wrong.

Tips For Online Protection From Escrow Fraud

Write down all of the email addresses and phone numbers of the agents that you are working with for your transaction as well as the contact information for your escrow company. If you are contacted by someone that is not on your list, verify their identity with your escrow company and record it. When in doubt, call your escrow company.

Never discuss or reveal any personal financial information via email. Email is NOT a safe place to discuss sensitive topics. If your escrow company requires personal financial information, discuss directly with your agent a plan to safely transfer this information.

If a scammer has hacked the email account and is emailing you as your real estate agent, you’ll have no way of knowing just by looking at the email address. If you’ve received an email regarding your closing process and it seems suspicious or you haven’t yet discussed these topics with your escrow company, proceed with caution. Don’t reply to the email and call your escrow company immediately to verify that the email is valid.

While consumers are disproportionately impacted by escrow fraud, scammers often first infiltrate the systems of escrow and real estate companies. Once they’re able to access the system, disaster could be only a few clicks away.

What to do if you’ve been a victim of escrow fraud:

Realizing that you’ve fallen victim to escrow fraud can be devastating and can be an extremely difficult process to reverse.

Act fast!

Once you realize you’ve been scammed, contact your escrow company immediately and inform them of the situation. You must act as fast as possible. Reporting the fraudulent activity quickly may increase your chances of getting your money back, but unfortunately, this is rarely the case.

Contact the FBI and file a complaint

If you are the victim of escrow fraud or online wire fraud, alert the FBI by filing a complaint here.

Contact Us

Contact Form Demo (#3)