Missouri Recommends Title Agencies ‘Verify and Call Back’ Before Wiring Funds

February 23, 2017

The Missouri Department of Insurance (DOI) is the latest regulator to offer warnings about fraudulent email and money wiring scams.

The DOI recently concluded several investigations related to fraudulent email schemes during real estate transactions. The department reported that in each instance, an email was received changing the original instructions for disbursement of funds previously provided by a consumer. The scheme makes it appear that the email is from a bank, real estate agent or party to the closing transaction. The email instructs funds to be directed to a different bank account or stops payment on an escrow check delivered at closing and direct funds be wired to another bank account or to a party not related to the transaction.  

To prevent these schemes, the department suggests that title insurers, title agencies and title agents educate their staff about fraudulent email schemes and to implement procedures to “verify and call back” to the consumer, ensuring the instructions are correct.

The DOI provided these red flags to help spot a fraudulent email:

  • Email address has been altered
  • Initial wire instructions are changed at any point during the transaction by any party to the transaction
  • Bank account name is not a party to the transaction
  • Instructions for “immediate action” or language suggesting “urgency” or “anger”

The Federal Trade Commission, Financial Crimes Enforcement Network (FinCEN) and Colorado Division of Real Estate at the Department of Regulatory Agencies (DORA) also recently issued warnings.

For more, see the related article “Cyber Snipers Zero In on Industry.”

Contact ALTA at 202-296-3671 or [email protected].