Domestic United States wires move over Fedwire, operated by the Federal Reserve, or CHIPS, a private clearing house. Both are designed for high value, time critical payments and both settle with finality. Finality is the property that makes wires useful for closings and payroll funding, and the same property that makes wire fraud so damaging.
Recovery after a fraudulent wire is not a reversal. It is a request to the receiving institution to freeze funds that have not yet been withdrawn, often coordinated through the FBI IC3 Recovery Asset Team. The window is measured in hours.
Common questions
Can a wire transfer be reversed?
Not unilaterally. Once settled, the funds belong to the beneficiary, so recovery depends on the receiving bank voluntarily freezing or returning them before they are moved.
How long do you have to recover a fraudulent wire?
Hours, in practice. Reporting immediately to the originating bank and to the FBI IC3 gives the best chance of a freeze at the receiving institution.
Primary sources
- Uniform Commercial Code Article 4A, funds transfers
- FBI Internet Crime Complaint Center (IC3), annual Internet Crime Report
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