Please ensure that this alert is shared amongst your colleagues and that you continue to alert your clients to the fraudulent activity which can take place.
We have seen an increase in attempted client account frauds in recent weeks.
This alert is a reminder that your firm should never accept payment details by email. If you receive an email with bank details, you must take steps to confirm that the instructions and the bank details are valid.
We see a number of these frauds in conveyancing transactions but we also see fraudsters targeting all areas of practice where funds are transferred. We have recently seen a number of cases where executries have been targeted.
Similarly, whilst the typical scenario is the fraudster masquerading as the client, we have also seen cases where the fraudster masquerades as a colleague within a law firm. In these cases, the instruction to the cash room to make a payment is made by a fraudster, typically posing as a partner of a law firm. Here, again, client funds are paid away on the strength of fraudulent instructions, and without proper authority.
Remember, there may be no way to distinguish between a fraudulent email and the real thing. Always treat email instructions (internal or external) with a degree of suspicion. All staff should receive updates regarding the risk of payment fraud, how it is perpetrated and how it can be avoided. Have strong procedures and protocols in place regarding the checking and authorisation of any payments to be made from the client account (or indeed the firm's own account). Dual signoff for larger amounts is always wise.
Clients fall foul of fraudsters too. Make sure you discuss these issues with them and that they know you will not contact them by email to advise a change of your bank details.
Please stay alert to these issues and ensure that you are certain who you are dealing with in any transaction.
Please don't hesitate to contact Matthew Thomson at firstname.lastname@example.org or Kenneth Law at email@example.com if you wish to discuss this or any other risk management issue.