Real Estate News

FBI: Title company fraud complaints spiked in 2016

Published: 15 May 2017

Fraud prevention is an unavoidable issue for real estate companies, including those that handle title. According to a May 4 FBI announcement, 2016 saw a particularly large amount of complaints lodged with the Internet Crime Complaint Center, also known as IC3. 

The source specifically mentioned business email and email account compromise scams, which can involve exploiting wire payments to make unauthorized transfers, perhaps as part of a connected series of scams. In 2016, title companies reportedly filed 480 percent more complaints on this than the previous year, marking it as a particular vulnerable area.

Though the impact on the title industry is important, it's also a sign of the larger seriousness of this type of scam. The FBI said that there were 22,292 victims in the U.S. between October 2013 and December 2016, with a total exposed dollar loss of more than $1.5 million. Outside of the U.S., the loss was $626,915,475. Just between June and December 2016 alone, U.S. financial recipient exposed dollar loss added up to $346,160,957.

In a press release on wire fraud in April, American Land Title Association CEO, Michelle Korsmo, said that the spring season made raising awareness important. If this attitude continues to build, the issue could become an even more pressing one.

These may be recent warnings but they follow years of similar concerns, and it isn't just the FBI that has paid attention to this. In 2015, The National Association of Realtors advised real estate professionals to be on guard against possible fraud and take secure measures, including using strong passwords and protected WiFi connections.

It also encouraged "cleaning out" email accounts, which may be because the wire fraud scheme usually involves social engineering. Reporting was another part of the recommended steps, and was something the FBI suggested as well.