Real Estate Wire Fraud: How It Works and Who’s Liable

You probably think of the closing as the safe part of buying a home. The offer was accepted and the loan came through. The only thing left is moving the money, and that last step is exactly where the criminals are waiting.

Real estate wire fraud has become one of the most efficient ways to steal a large sum in a single move. The FBI treats it as a form of business email compromise. Its 2022 report to Congress put total business email compromise losses for 2021 above $2.4 billion. It doesn’t take a sophisticated hacker. It takes a compromised email account and some patience.

Key Takeaways

• Real estate wire fraud is a scam where a criminal hacks an email account in a home sale and sends fake wiring instructions.
• It’s a form of business email compromise, which the FBI tied to more than $2.4 billion in losses in 2021.
• The criminal is rarely reachable, but a negligent agent, brokerage, escrow company, or lender may be liable.
• If it happens, the first hours matter most: call your bank and report the theft to the FBI without delay.

How real estate wire fraud works

Real estate wire fraud is a scam that targets the money moving through a home sale. A criminal gets into an email account connected to the closing and watches the deal in silence. At the last moment, they send wiring instructions that route the funds to an account they control.

Every home sale generates a chain of emails connecting the buyer, the seller, the agents, the escrow or title company, and the lender. A criminal only needs to get into one of those email accounts.

Once inside, the criminal doesn’t act. Not right away. They read. They watch the deal develop and learn the closing date and the dollar amounts. They study how the agent signs off on emails and how the escrow officer phrases things.

Then, a few days before closing, the wiring instructions arrive. They look right, because the criminal has spent weeks learning what “right” looks like. Sometimes the email comes from a lookalike address, a domain that is one character off from the real one and easy to miss. Sometimes it comes straight from the hacked account, signed in the name of someone the buyer has been emailing for a month. The buyer follows the instructions, because everything about the exchange looks like it came from their own real estate professionals. Within hours the funds are pulled out and gone.

Sellers get hit the same way, when a criminal fakes the closing disbursement instructions and the seller’s proceeds land in an account they control. The losses are not spread evenly. A 2023 FinCEN analysis of real estate wire fraud found that individual homebuyers suffer disproportionately. For a buyer, the money in that wire is often a down payment built up over years.

Who can be held liable

The criminal who took your money will probably never pay it back. But they may not be the only one who owes it.

In California, your agent owes you a fiduciary duty and a duty of reasonable care. An agent who runs a six- or seven-figure closing through a compromised email account may have fallen short of that duty. The brokerage that supervises the agent can share the liability. If the breach instead originated with the escrow or title company, or the mortgage broker, that party can face its own claim for negligence, for failing to secure the systems the transaction ran through.

None of this is a novel theory. The National Association of Realtors’ member news on the FBI’s 2025 fraud figures reminds brokers to keep a risk-reduction plan in place and to run regular wire fraud training for their agents and staff. California’s regulator has done the same on the escrow side: a 2025 bulletin from the Department of Financial Protection and Innovation told licensed escrow companies to tighten their defenses against these scams. When a professional ignores guidance its own industry and regulator have spelled out, that failure is easier to prove.

Don’t delete anything

If a wire fraud hits your closing, the evidence is mostly sitting in an email account, and it’s fragile. Save all of it. Don’t delete the fraudulent emails, and don’t delete the legitimate ones either, because the case can turn on the difference between the two. Keep the wire instructions and every attachment exactly as they arrived.

The email headers show which account was compromised and where the fraudulent mail really came from. Leave the originals in place, and ask everyone else in the deal to preserve their copies too. We build these cases on exactly that record.

Frequently asked questions

What should I do right after I discover a real estate wire fraud?

Move fast, because the first hours decide how much can be recovered. Call the bank that sent the wire immediately and ask it to recall the funds. Report the theft to the FBI at ic3.gov and file a police report. Preserve every email. Then call a lawyer.

Can I sue my real estate agent if I wired money to a scammer?

Possibly. A California real estate agent owes you a fiduciary duty and a duty of reasonable care. If your agent’s email account was compromised, or your agent passed along fraudulent wiring instructions without verifying them, that can be a breach of those duties, and the broker who supervises the agent can share the liability.

Can I get my money back after real estate wire fraud?

Sometimes. If the theft reaches your bank and the FBI quickly, the wire can occasionally be frozen before the criminal moves it. Once that window closes, recovery usually means a claim against the negligent party in the transaction, or that party’s insurer, rather than against the fraudster. No lawyer can promise a result.

Who is liable for real estate wire fraud?

It depends on whose email or system the criminal got into. Liability can fall on the real estate agent, the brokerage that supervises the agent, the escrow or title company, or a lender, and sometimes on more than one of them. Recovering from a bank is harder, because of the law that governs wire transfers.

How much does it cost to hire a real estate wire fraud lawyer?

Rosenberger + Kawabata offers a free, confidential consultation, so an honest read of your case costs you nothing. If we take the matter, we can discuss fee arrangements that fit a recovery case, including contingency and alternative structures where the facts support it.

Where we come in

We represent California buyers and sellers who lost money this way. We trace the evidence and pull the email records that pin down the compromised account and who had the duty to prevent it. Some of these cases settle with an insurer. Some are tried. Each one starts with an honest read of whether the facts support a claim.

If a wire fraud cost you a down payment or your sale proceeds, contact Rosenberger + Kawabata online for a free and confidential consultation, or call (310) 894-6921.