Fraudsters targeting property sellers

Fraudsters targeting property sellers

Innocent vendor targeted by cybercrime fraudsters

The Daily Telegraph has reported a case detailing identity theft and cyber crime. The victims were the Lupton family from the South East. They suffered a huge loss of just under £335,000 from the property sale funds of their South London flat.

The exchange had occurred and it was only two days prior to completion that the Lupton’s solicitors emailed him requesting the bank details into which he would like the sale proceeds paid into.

Mr Lupton replied sending the details to his Barclays bank account. It was this email which was intercepted by fraudsters. It is not known how, there is a possibility that the criminals used technology which ‘x-rays’ emails to identify data patterns to locate those which contain valuable financial information, but what is certain is that they targeted Mr Lupton’s email and the information contained in it.

Having hacked his account the criminals then posed as Mr Lupton, intercepting his account and sending an email which told the vendor solicitors to disregard the previous email containing Mr Lupton’s true account details, and instead to send funds to their account for which they provided new details.

On completion, the Lupton’s solicitors transferred fees of nearly £335,000 to the account given via the intercepted email which meant that the monies landed firmly in the criminals clutches.

Barclays, by coincidence, was the bank of choice for all three parties involved; the solicitors, the Luptons and the fraudsters. The account was frozen by Barclays and £271,000 was returned to the family. They are still £62,000 out of pocket.

The increase in financial fraud aimed at the industry is on the increase:

There are vast amounts of cash floating around every day, a natural occurrence by virtue of the very nature of conveyancing transactions, 5 years ago this did not appear to present a problem. Fast forward to the here and now; the large transactional value of many property transactions are just too easy for cybercriminals and fraudsters to target. Mix this with the fact that conveyancing is a very trusting community of professionals inherently led by a collection of veracious individuals, and we have an all too easy ready-made scapegoat.

How you can protect yourselves and your clients

Through the implementation of Lawyer Checker’s AES (Account and Entity Screen) search you can check whether the destination bank account is a genuine account used for conveyancing purposes.

For accounts which are not normally used for conveyancing purposes (as in this case) an AML check with Bank Account Verification would confirm ownership of the bank account.

In this particular matter, the industry regulator, the SRA said; “Member firms are responsible for safeguarding client funds, and must replace any money that was improperly withheld or withdrawn from a client account.”

It is becoming increasingly relevant for firms to be able to prove that they are performing due diligence, not only in terms of the Money Laundering Regulations, but also in terms of being able to know where their client funds are going and being able to show that they are doing all that they can to mitigate any potential risk to client money and assets.

Don’t let your client conveyancers become vulnerable to scrutiny – partner a Lawyer Checker AES search with an AML check and give your users the perfect partner package in beating the bogus fraudsters.