| name | wire-fraud-and-trust-account-controls |
| description | Protect the money: verify every wire by out-of-band callback before sending, require dual authorization, reject email-changed instructions, and safeguard the escrow trust account with three-way reconciliation, no commingling, and daily oversight. Business-email-compromise sensitive; each control specific is verify-at-use. |
Wire-Fraud & Trust-Account Controls
The two controls that keep a settlement operation solvent: no wire leaves without out-of-band verification, and the escrow trust account is reconciled and protected absolutely.
Advisory, not legal or financial advice. These are operational control patterns, not a compliance certification; specific ALTA pillar language, state trust-account rules, and bank product terms are [verify-at-use]. No PII. This skill designs controls; a licensed officer executes them.
Wire-fraud controls (the disbursement never skips these)
| Control | What it is | Why |
|---|
| Out-of-band callback | Verify every payoff/proceeds destination by phone to a number you sourced independently — never from the email/instruction itself | Business email compromise supplies fake numbers |
| No change by email | Any account/routing change to instructions already on file is treated as fraud until re-verified by callback | The classic BEC "updated wire instructions" attack |
| Dual authorization | A second authorized person approves every outgoing wire | Removes the single point of failure |
| Positive pay / bank controls | Bank-side control on outgoing items | Catches altered/unauthorized items |
| Educate the parties | Warn buyers/sellers in writing that wire instructions will not change by email | Most consumer wire fraud hits the party, not the agent |
The rule: verify the wire before you send a dollar. A callback is cheap; a wire loss is often unrecoverable.
Trust-account controls (protect the escrow account absolutely)
| Control | Standard |
|---|
| Three-way reconciliation | Bank balance = book balance = sum of open file ledgers, reconciled on a set cadence ([verify-at-use]) |
| No commingling | Escrow/trust funds never mixed with operating funds |
| No negative ledgers | No file ledger goes negative — that is spending another file's money |
| Daily oversight | Positive-pay, ACH blocks, and reconciliation reviewed by someone independent of the disbursing officer |
| Segregation of duties | Whoever reconciles is not whoever disburses |
Every dollar in the account belongs to someone else. A shortage is a fiduciary breach, not a bookkeeping lag.
Read metrics
| Signal | What it tells you |
|---|
| Wires sent without documented callback (target: zero) | A live fraud exposure |
| Three-way reconciliation variance / age | Trust-account health |
| Days to detect a ledger negative | Oversight cadence adequacy |
See also
