CFPB Answers ALTA’s Request to Issue Consumer Alert on Wire Fraud

July 11, 2017

On July 7, the Consumer Financial Protection Bureau (CFPB) finally heeded ALTA’s advice and published a warning to help alert consumers about wire fraud schemes.

On its blog, the CFPB says “scammers attempt to steal the homebuyer’s closing funds—for example, their down payment and closing costs—by sending the homebuyer an email posing as the homebuyer’s real estate agent or settlement agent (title company, escrow officer, or attorney). The email falsely claims there has been a last minute change in the closing process, for example, that a check is no longer acceptable or that the wiring instructions have changed. It instructs the homebuyer to wire or otherwise electronically transmit the closing funds to an account that the scammers control.”

The warning echoed the tips in ALTA's recent consumer alert, along with alerts from the Federal Trade Commission, FinCEN and the FBI.

In January, ALTA’s Board of Governors met with CFPB Director Richard Cordray to inform the bureau about the threat of wire fraud schemes. At the time, Cordray was skeptical about the frequency of the crimes and the risk to consumers, according to ALTA CEO Michelle Korsmo. ALTA also sent a formal letter requesting that the CFPB put out a consumer alert on the topic. In addition, Title Action Network members sent nearly 1,000 messages to 241 members of Congress asking them to reach out to the CFPB to publish a consumer alert on wire fraud.

“This alert from the CFPB—along with all the alerts from other agencies—will not, in itself, do anything to combat these crimes," Korsmo said. "There is little the CPFB can do to prevent wire fraud. The only way these alerts will help is if we put them to use. We all need to use consumer alerts to help educate our buyers, sellers and real estate partners about the risks. We need to give them simple ways to protect themselves. ALTA is developing some new resources to help, but ultimately, it comes down to our industry getting in the habit of talking about this risk at every opportunity.”

ALTA is in the process of developing a short video and an infographic that members can brand with their logo to help raise awareness educate consumers about wire fraud.


Contact ALTA at 202-296-3671 or communications@alta.org.

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