ALTA-supported Wire Fraud Language Added to Senate Appropriations Bills
November 12, 2020
Similar to efforts in the U.S. House of Representatives, ALTA successfully worked with the Senate Committee on Appropriations to push several federal agencies to focus more on real estate wire fraud as part of Congress’s annual appropriations process.
In all, the Senate Committee on Appropriations released 12 Fiscal Year 2021 funding measures. The report language included in three appropriation bills directs federal agencies like the FBI and FinCEN to produce reports on their current efforts on wire fraud and for suggestions of new legislative authority to help them combat these crimes. For the Department of Housing and Urban Development (HUD), the language requires the department to brief the committee on efforts educate consumers about real estate wire fraud.
“By and large, these bills are the product of bipartisan cooperation among members of the committee,” said Senate Appropriations Committee Chair Richard Shelby. “As negotiations with the House begin in earnest, I look forward to working with Chairwoman Lowey, Vice Chairman Leahy, and Ranking Member Granger to resolve our differences in a bipartisan manner. Time after time, we have demonstrated our willingness to work together and get the job done. We have before us the opportunity to deliver for the American people once again.”
An appropriation bill, also known as a spending bill, is legislation that that authorizes the expenditure of government funds. The bills direct federal agencies on how to spend their budgets. Directing agencies to spend money on a specific topic or produce a report is a critical way to elevate an issue with federal policymakers.
Below is a summary of the committee’s recommendations affecting real estate wire fraud and business email compromise:
Real Estate Wire Fraud
On page 132 of its recommendations to HUD, the committee said it is concerned about the increasing threat of real estate wire fraud in homeownership and rental housing markets. According to the Federal Bureau of Investigation’s Internet Crime Report, roughly $221,000,000 was lost through real estate wire fraud in 2019. The committee noted that HUD is developing materials for housing counseling agencies and stakeholders to address this growing threat and encourages HUD to work with its agency partners in developing tools, guidelines and educational materials. The Committee directs HUD to brief the House and Senate Committees on Appropriations within 90 days of enactment of this Act on the efforts of HUD, interagency partners, and housing counseling agencies to educate consumers on real estate wire fraud.
Business Email Compromise
In this 203-page bill, the committee noted it remains deeply concerned by the growth of business email compromise (BEC) schemes. Since the FBI began tracking BEC in 2013, it has gathered reports of more than $10 billion in losses for U.S. victims alone. On page 81 of this appropriations bill, the committee directed the FBI to continue efforts such as ‘‘Operation reWired” and urged enhanced coordination among the FBI’s 56 field offices as well as federal partner agencies. In Senate Report 116–127, the committee directed the FBI to submit a report detailing ongoing activities to both combat and raise awareness of BEC schemes, including wire fraud in real estate and other types of cyber-enabled crime. This report will detail the roles and responsibilities of the department’s federal partner agencies, provide programmatic recommendations to Congress, and identify any resource needs associated with combatting BEC schemes.
Email Compromise Fraud
The committee noted in this bill it is aware of email fraud schemes in real estate in which the email accounts of victims are compromised to send fraudulent wire transfer instructions to financial institutions in order to misappropriate funds. Since 2013, there have been reported cases of business e-mail compromise and email account compromise involving more than $3 billion. On page 14 of its report, FinCEN is directed to brief the committee within 60 days of enactment of the act on efforts to help financial institutions identify and prevent these schemes.
ALTA Resources
ALTA has developed several resources, including videos and an infographic, that members can use to educate consumers and others about wire transfer fraud. To access these materials, go to alta.org/wirefraud.
Contact ALTA at 202-296-3671 or [email protected].