2021 was another record year for wire fraud losses. Even though we have been working to educate everyone within the real estate transaction for the past several years, it seems that the criminals still have the advantage. The FBI recently released the 2021 Internet Crime Complaint Center (IC3) report, which was not good news. Reported losses from wire fraud (BEC/EAC) increased to over $2.3 billion.
Overall, in 2021 over $6.9 billion and losses were reported to the FBI. That is a $2.7 billion increase from 2020 and puts the total losses over the past five years at $18.7 billion. The most effective method used by criminals has been Phishing/Vising/Smishing, which all rely on social engineering. Unfortunately, there are few technologies that can protect you from Social Engineering. While technologies are being developed using Artificial Intelligence and Machine Learning, they are expensive.
What can you do to protect your business and customers? Identify your risks and take action. There are things that you can do quickly to help reduce your risk.
- Educate your employees, make sure they understand they are a target. Especially those that deal with wire transfers.
- Never trust email. Emails can be easily modified to deceive the recipients.
- Never wire funds unless you are sure of the recipient.
- Whenever there is a change in wire instructions, be very suspicious. Every wire fraud is enabled by a change in wire instructions.
If you don’t know how to do a risk assessment, WESTprotect can help with our Quick Start Cybersecurity Risk Assessment. We can guide you through the process and provide you with recommendations tailored specifically for you.