Here is an important warning for agents, conveyancers and their clients.
On Monday, Eye ran a story about the so-called ‘Friday afternoon scam’ being practised on conveyancers with large amounts of client money in their accounts.
Fraudsters typically hack into a law firm’s systems.
This could apparently be done by the simple expediency of sending an apparently trustworthy email with an attachment.
Once clicked, this downloads malicious software and allows the thieves to intercept emails, send emails of their own using fraudulent addresses, divert huge sums of money and stop completions going through.
We now believe this could be a much more widespread problem than has been thought, and urge all agents to do their best to ensure that their buyers and sellers’ transactions go ahead without this problem.
We also urge agents to discuss it with their conveyancing partners and contacts.
Since we ran the story, we have been told of two separate cases.
We cannot disclose the details, but what both have in common is that the solicitors were informed by email, apparently from their clients, that the client had changed their bank account.
The conveyancing firms then paid the money into the “new” account, and the fraudsters then promptly emptied it out.
Both cases have happened in the last few weeks, stalling both transactions and causing an enormous amount of stress and heartache. Both transactions involved major banks.
Conveyancers, no matter how busy they are, should always beware when a client tells them they are changing their bank account. It is, after all, unlikely to happen just as a major transaction is approaching.
We feel agents should advise sellers and buyers to specifically advise their conveyancers that they will NOT be changing their bank account details. And also to be extremely circumspect as to what information they do give electronically.
It is only our view, but could old-fashioned letter writing be a better and far less risky alternative?
A final note of warning: we understand that where the solicitor’s Professional Indemnity insurer does pay up, a confidentiality agreement may be put in place.
If so, that means that we do not know the full extent of this scam.
However, for Eye to have been informed of two entirely separate cases within two days should set alarm bells well and truly ringing.
It is also the case that where insurance payouts increase, then so does the cost of Professional Indemnity – which in turn could increase the costs of conveyancing.
It seems that agents could very usefully forward this warning to all their clients and conveyancing contacts.
Eye’s first story on Monday is here