The number of wire fraud scams reported by title companies to the Internet Crime Complaint Center (IC3) spiked 480 percent in 2016, according to a warning issued to businesses by the FBI.
According to the FBI, perpetrators monitor real estate transactions and time the fraudulent requcst for a changc in payment type (frequently from check to wire transfer) or a change from one account to a different account under their control.
The two common scams are known as:
Business Email Compromise (BEC). This scam targets businesses working with suppliers and/or businesses that regularly perform wire transfer payments.
Email Account Compromise (EAC): This version of a BEC targets individuals that perform wire transfer payments.
BEC/EAC scam continues to grow, evolve, and target small, medium and large businesses. The FBI reported that between January 2015 and December 2016, there was a 2,370 percent increase in identified exposed losses. scam has been reported in all 50 states and in 131 countries. Victim complaints filed with the IC3 and financial sources indicate fraudulent transfers have been sent to 103 countries.
Businesses with an increased awareness and understanding of the BEC/EAC scam are more likely to recognize when they have been targeted by BEC/EAC fraudsters, and are therefore more likely to avoid falling victim and sending fraudulent payments.