Scamming people for money is not a new concept but it has gotten much more sophisticated as technology continues to advance. Email wire transfer fraud is one of the most common types of fraud. In 2018 alone, the FBI received more than 20,000 email wire fraud complaints with adjusted losses of more than $1.2 billion, according to the the organization’s 2018 Internet Crime Report. Attorneys can be an easy target for cybercriminals because they often wire money to or on behalf of clients. Real estate attorneys are especially at risk, as Americans lost nearly $150 million to real estate scams just last year.
Email wire fraud is a sophisticated scam that involves the use of social engineering to conduct an unauthorized transfer of funds. Social engineering is defined as manipulating individuals into divulging confidential or personal information that may be used for fraudulent purposes.
A common scammer pattern is to become involved in a transaction, such as the sale of real estate. Cybercriminals imitate the seller or his/her lawyer’s email and instruct the buyer to wire funds to the scammer’s bank account. Failure to verify the instructions leads to the funds being wired to the scammer. Another common scenario involves proceeds from a transaction deposited into a law firm’s trust account, paired with an email request appearing to come from the client, requesting the funds be sent to the client using specified routing and bank account numbers. Unfortunately, the email and a look-alike signature block were fraudulent.
Read below to learn some tips for how to manage your risk and protect yourself against email wire fraud.
Email wire transfer fraud is often thought to be a cyber event that is covered under a cyber risk policy. However, a cyber event is most often defined as a discoverable act, such as one involving hacking or a data breach. Email wire transfer fraud is classified as “social engineering,” and therefore is not usually covered under a pure cyber insurance policy.
Email wire fraud has grown to the point of being an epidemic and we at OAMIC have had a couple of insureds impacted by scammers. Making yourself aware of these types of scams can help you prevent them. Please contact us if you have any additional questions.
On the OAMIC team since 2005, Isaac now serves as vice president, director of operations. He is a licensed insurance producer with two bachelor’s degrees from the University of Oklahoma. Prior to his time at OAMIC, Isaac was part of the engineering team that developed banking software for some of the largest banks in the United States.
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Oklahoma Attorneys Mutual Insurance Company
3900 S Blvd
Edmond, OK 73013
PO Box 5590,
Edmond, OK 73083
