In today’s real estate landscape, phishing and wire fraud have emerged as some of the most insidious threats to agents and clients. Monica Schroeder, President of Verus Title, recently highlighted the evolving tactics fraudsters employ to exploit real estate transactions, shedding light on how these schemes unfold and the widespread damage they cause.

Schroeder explained that phishing often serves as the starting point for many fraud schemes. Fraudsters send emails or texts that appear to come from reputable sources—clients, agents, or title companies—to trick recipients into sharing sensitive information or clicking on malicious links. Once the recipient takes the bait, the fraudsters gain access to their email accounts and silently observe communication for weeks or even months.

In some cases, the criminals implement forwarding rules on the compromised email account, redirecting correspondence to their accounts. This allows them to monitor every detail of the transaction without detection. They learn who the involved parties are, track the timeline, and wait for the opportune moment to strike—often during closing when large sums of money are in transit.

The Anatomy of a Fraudulent Transaction

Phishing schemes manifest in two primary scenarios: wire transactions and fake sellers. In the first, the criminal infiltrates legitimate transactions by altering wire instructions. They intercept emails, change the recipient’s banking details to their own, and send the revised instructions to the title company. Often, this occurs without raising suspicion until it is too late, and the funds are irretrievably gone.

On the other hand, fake seller schemes involve fraudsters posing as property owners. They create convincing but fraudulent listings for properties they don’t own—usually vacant or mortgage-free homes—and enlist unsuspecting agents to handle the sale. The goal is to pocket the proceeds by directing funds to accounts under their control. In such cases, the real homeowner may not realize their property has been “sold” until long after the transaction closes.

One particularly alarming aspect of modern fraud is using artificial intelligence (AI). Schroeder warned that criminals can now clone voices with startling accuracy. A few seconds of audio from a YouTube video or Instagram Reel can provide enough material for AI programs to replicate someone’s voice, including tone and cadence. Fraudsters may use this to impersonate an agent, client, or seller, making convincing calls to request updated wire instructions or to “confirm” details.

Why Detection is Challenging

Phishing is difficult to detect because it is stealthy. Unlike malware or ransomware, phishing attacks do not announce their presence. Instead, they operate silently, blending into normal communication patterns. Real estate agents often only realize they’ve been compromised after a fraudulent transaction has occurred.

Schroeder emphasized that phishing and wire fraud do not only target agents—they affect everyone involved in a transaction. Buyers, sellers, title companies, and even lenders are at risk. The FBI has reported that 22% of fraudulent communications in real estate transactions appear to come from the victim’s real estate agent. This statistic underscores the critical need for vigilance and proactive security measures.

Real estate transactions involve a high level of trust, making them attractive targets for fraudsters. As Schroeder aptly puts it, “The bad guys are watching. They know the transactions are about to close, and they strike at just the right moment.” Understanding these criminals’ methods is the first step for agents in protecting their clients and professional reputations.

Grow Your Real Estate Business with Fathom Realty!

Are you seeking a brokerage that prioritizes your success and empowers you to achieve more? At Fathom Realty, we provide innovative technology, expert training, and local support to fuel your growth. Our culture of collaboration and service ensures you’re never alone in your journey. With Verus Title, you’ll also have access to exceptional expertise, ensuring smooth and secure closings for your clients. Join us at Fathom Realty and discover what’s possible when you have the right tools, support, and community. Come grow with us today!