Wire Fraud at Closing in San Diego: How to Protect Your Down Payment

Wire fraud at closing happens when a scammer sends a buyer fake wiring instructions that look like they came from the agent or the settlement company, and the buyer sends their down payment to the scammer's account. The Consumer Financial Protection Bureau's advice is simple: never follow wiring instructions from an email, and verify the account by phone using a number you saved earlier.

How the scam works

The CFPB explains that scammers compromise a real estate professional's email account so they can read client messages and find upcoming closings. They then send spoofed emails to buyers, posing as the agent, the settlement agent or another trusted party, with false wiring instructions meant to divert closing costs and down payments.

The CFPB post is from 2019 and is now archived, and it reported an FBI estimate of nearly $1 billion in losses from these schemes in 2017. Since then, the basic method has not changed, which is why the advice has not changed either.

Warning signs

• A last-minute change to wiring instructions, especially one that arrives by email.
• An email that looks like it comes from your agent or settlement agent but may be spoofed.
• Links or attachments you have not confirmed with your trusted contacts.
• Phone calls asking you to confirm personal or financial information.

How to protect your closing funds

The CFPB recommends a short plan you can set up on the first day of your purchase:

1. Pick two trusted contacts, such as your agent and the settlement agent, and talk through the closing and payment process by phone or in person.
2. Write down their names and phone numbers before closing. Consider agreeing on a code phrase.
3. Before you wire money, verify the account name and number by phone, using the number you saved earlier and not one from an email.
4. Never follow wiring instructions that arrive in an email.
5. Do not click links or open attachments until you have confirmed them with your contacts.
6. Do not email financial information, because email is not secure.

In San Diego, escrow is usually handled by a separate company from the title company, which I explain in my title and escrow guide. Ask your escrow officer how they send wiring instructions and how they want you to confirm them.

The Federal Trade Commission's warning

The FTC says scammers pressure people to send money by wire because they can take it and disappear, and that once money goes out through a wire service you usually cannot get it back. Its general advice is never to wire money to someone you have not met in person. A closing is the rare case where you will wire to an escrow company, which is exactly why the phone check matters.

If you think you have been scammed

• Contact your bank or wire transfer company immediately and ask for a wire recall. The CFPB says reporting as soon as possible improves your chance of recovery, but it does not give a time window.
• File a complaint with the FBI's Internet Crime Complaint Center at ic3.gov.
• The FTC also takes reports at reportfraud.ftc.gov.

Tell your agent, your lender and your escrow officer right away, so they can warn others involved in the transaction and secure their accounts.

Where this fits in the timeline

Your down payment and closing costs are due near the end of the process, after your lender's final numbers. The forms that show those numbers are in my Loan Estimate and Closing Disclosure guide. If you are using funds from selling another home, see home equity and HELOCs first.

It also pays to know your agent's habits. A professional who warns you about scams, and tells you how and when they will contact you, is doing the job. I cover what to look for in working with a REALTOR.

My advice for San Diego buyers

1. Set up your two trusted contacts and write down their phone numbers when you open escrow.
2. Treat any change to wiring instructions as a red flag until you confirm by phone.
3. Use the phone number you saved earlier, not the number in an email.
4. Send documents through a secure portal that your lender or escrow officer provides, when possible.
5. If something feels wrong, stop and call before any money moves.

A note on advice

I am a REALTOR®, not a lender, attorney, tax professional or financial advisor, so this guide is general information. Your lender can tell you what you qualify for, and a CPA or attorney can answer tax and legal questions.

Related guides

• Home Equity in San Diego: What It Is and How a HELOC or Home Equity Loan Works
• Written Buyer Agreements in San Diego: What to Know Before You Tour a Home
• Working With a REALTOR in San Diego: What to Expect and How to Check a License
• Mortgage Rate Locks in San Diego: How They Work and What Can Still Change
• How Much Are Closing Costs When Buying a Home in San Diego?
• Final Walkthrough Checklist for San Diego Home Buyers

Frequently asked questions

What is wire fraud in a real estate closing?

It is a scam where a criminal sends a buyer fake wiring instructions, posing as the agent or settlement agent, to divert closing costs and down payments.

What is the biggest warning sign?

A last-minute change to wiring instructions, especially one that arrives by email.

How do I verify wiring instructions?

Call a trusted contact, such as your settlement agent, at a phone number you saved earlier and not one from an email, and verify the account name and number.

What should I do if I sent money to a scammer?

Contact your bank or wire transfer company immediately and ask for a wire recall, then file a complaint with the FBI's Internet Crime Complaint Center at ic3.gov.

Can I get a wire back?

The FTC says that once money is sent through a wire service you usually cannot get it back, which is why reporting immediately matters.

About the author

Trevor Landress is a San Diego REALTOR® with Coldwell Banker West (DRE# 02126901). He was born and raised in San Diego and has been licensed since 2021.

Trevor helps homeowners sell, guides first-time buyers through the home buying process and assists investors with their next acquisition. His work includes negotiating offers, analyzing market trends, building pricing strategies and running marketing campaigns for his listings.

He serves clients across San Diego County, from coastal communities like La Jolla, Del Mar and Carlsbad to neighborhoods inland.

Trevor is part of the Campbell Group, a three-generation real estate team, and he and the Campbell Group consistently rank as a top producing team at Coldwell Banker West each month. He writes these guides to help San Diego buyers and sellers navigate an ever-changing market. To talk through your plans, call or text (619) 402-4614 or contact Trevor Landress.

How I help San Diego home buyers

I help buyers sort out their budget, understand their loan options with a lender, search for homes, write and negotiate offers, keep track of inspection and contingency deadlines and stay organized through closing.

How I help San Diego home sellers

I help sellers price their home, prepare it for the market, market it to buyers, review and negotiate offers and manage the steps from an accepted offer to closing.

Rules and official pages

• CFPB: Mortgage closing scams
• FTC: Wire transfer scams