Wire Fraud Is Targeting First-Time Buyers

CHICAGO — A young, first-time home buyer was filled with excitement to finally own a home. She had her offer accepted and secured her loan in the fast-paced, COVID-era, 2020 housing market, when home prices were climbing fast. But on the eve of closing, the $30,000 down payment she wired vanished. A scammer had intercepted the transaction, impersonated a trusted party and diverted the buyer’s entire life savings.

It took two years to recover the money. Even though it came years later, she was still considered lucky – too often, the funds are never recovered. Leaving home buyers without their money – or their home, says Tom Cronkright II, a real estate broker and co-founder and executive chairman of the wire fraud protection firm CertifID.

Cronkright has countless stories of home buyers and sellers being duped out of their life savings in a real estate transaction. Also, as the CEO of Sun Title, he says he has been a victim of wire fraud while coordinating countless real estate transactions. He now devotes himself to trying to catch those who prey on home buyers and sellers – a threat he says is only growing bigger.

First-time home buyers are particularly vulnerable to these scams – with their inexperience in a transaction offering a recipe that scammers quickly exploit.

Cronkright’s company published a 2025 State of Wire Fraud Report, revealing that first-time buyers are three times more likely to fall victim to wire fraud than more experienced real estate clients.

But certainly, he notes, this is hardly just a first-time buyer issue: After all, one in four consumers report receiving suspicious messages during a real estate transaction, and one in 20 (including first-timers and repeat buyers) fall victim to a scam, according to CertifID’s report.

“When you’re a first-time home buyer, everything's new,” Cronkright says. “You have multiple parties in a transaction – more than you'd have in any other high-ticket purchase. And you're often communicating by text and email. So, you have an infrequent transaction, multiple parties and very large sums of money being transferred. That’s a dangerous mix.”

A perfect storm for fraud

Real estate transactions are prime targets for scammers. Consider:

Public listing data is easily accessible.

Multiple stakeholders are involved – real estate agents, lenders and title companies.

Communication is largely digital, often over email and text messages.

Large sums of money are exchanged, frequently under tight deadlines.

Scammers use social engineering to exploit these factors. They’ll monitor email chains; spoof addresses, phone numbers and identities; and lately even craft AI-generated voice that mimic the voices of agents and escrow officers. “You’ll start to see more of this voice replication in the coming years,” warns Cronkright.

Getting ahead of the scammers

About half of buyers are unaware of wire fraud risks at the start of a transaction, according to CertifID’s report. While that shows awareness remains an issue, progress has been made. Cronkright says the percentage was under 20% awareness just five years ago.

However, education is still lacking in how fraud often unfolds.

“We need to walk [clients] through it,” he says. For example, from the first time they deposit earnest money – what’s expected of them? What is the transfer process? Can they bring a check? What happens if wiring instructions change suddenly? What should they do?

Cronkright says the industry also must act as a unified front – lenders, title professionals and real estate agents – to shield consumers from the dangers.

“We all represent the consumer, and we need to understand they are at risk,” he says. “The threat is large and growing. We have a common enemy.” If the message gets across from multiple parties in the transaction, home buyers will be more likely to listen, he says.

Talk to your clients about specific risks:

•Fake wire instructions that seek to divert down payments

•Seller impersonation scams

•Hijacked email threads that reroute mortgage payoffs

Teach clients to verify every instruction with a person they know. If they suspect a scam in the transaction, they should also report it right away, Cronkright says. Report to IC3.gov.

Action steps for real estate pros

Thirty-five percent of buyers put the onus on real estate agents to educate them about the dangers of wire fraud scams, according to CertifID’s report. Buyers say they’d even pay extra for real estate agents who show that type of commitment – with 80% saying they’d choose an agent and broker who shows they prioritize their security, even if that means it comes at a higher cost in the transaction to them.

Here are some steps real estate professionals can take to better secure their transactions:

Educate early and often: Consider including wire fraud disclosures in buyer packets. Have clients sign off in acknowledging the risk. Several Realtor® associations have developed wire fraud notices to use Also, consider having an email message that warns about the dangers of wire fraud.

Hold security briefings: During listing and buyer presentations, walk your clients through each step in the transfer of funds, including how it works, how buyers will be notified, steps to verify independently, and so on. “Set up expectations early and clarify processes,” Cronkright says.

Promote verification protocols: Emphasize to buyers the importance of always confirming wire instructions via a known phone number – not one taken from an email or voicemail. Leverage encrypted communication and transaction portals to add extra layers of security.

Partner up: Commit to only working with title companies and attorneys who show a commitment to using secure communications as well. Partner with wire fraud prevention firms to offer additional security. The Coalition to Stop Real Estate Wire Fraud, which NAR is part of, is working to create more awareness, resources and support to help stop real estate scams: stopwirefraud.org.

Wire fraud is one of the biggest threats to real estate today, Cronkright says. “The consumer shouldn’t have to piece together a fragmented fraud prevention strategy,” he says. “It’s on us – as agents, brokers, title professionals and lenders – to provide a unified front against this growing threat.”

Source: REALTOR® Magazine

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