Conveyancers and home movers have warned about the increased risk of ‘Friday afternoon fraud’ after data from UK Finance showed £22.5 million of bank transfer losses via the inter-bank Chaps system. The warning from the National Association of Property Buyers (NAPB) highlights the availability of an estimated 12.5m personal email account details sold on the dark web facilitating the fraud, which typically sees criminals impersonating house buyers and solicitors in order to redirect sale or purchase funds.
The recent, heightened risk can be attributed partly to the increase in remote working; a quote from Today’s Conveyancer, from Jonathan Rolande from the NAPB, says, “It’s become a worse situation since things have changed become remote. Quite often, you’ll never meet your mortgage advisor, and you’ll never meet your solicitor; these things are usually done in call centres.
“People do play on that little bit more and also, particularly in the last couple of years as the property market has got so frantic, everyone’s got busy, and maybe that certain sort of corners are being cut by estate agents by solicitors, by purchasers or sellers themselves, just to get things done.”
Solicitors may feel like they play ‘piggy in the middle’, and there is an expectation for the AML strain to increase. There is a pointer towards the increase in direct legislation, which regulators must factor into their workflows.
The SRA will likely be heavily relied upon by the upcoming Economic Crime Bill to prevent money laundering and stated that “the level of fines for economic crime, particularly in the financial sanctions era, will increase radically.”
Plans for the Economic Crime Plan have been released, which the government says builds on the foundations of its predecessor with new actions to improve system-wide response to crime through enhanced cooperation between law enforcement, supervisory agencies and the private sector.
A large £100m is invested in cutting-edge technology, including data analytics, to equip enforcement with the tools needed to stay one step ahead. A dedicated team will be established to tackle the growing risk of fraud and criminal activity using cryptocurrency.
Friday Afternoon Fraud Help & Advice:
Fraudsters tend to target house deposit methods in a con known as payment diversion fraud.
It tends to happen on a Friday, as victims generally don’t realise until Monday.
Typically, it centres on hacking into the email account of the house buyer or the solicitor handling a sale. Then, they’ll impersonate the solicitor before sending fake bank details for the buyer to transfer sale payments or deposit money.
Make sure your email address hasn’t been exposed in a data breach by looking it up on a website called haveibeenpwned.com
Double-check solicitor email addresses when a new email is received. Scammers impersonating a solicitor will often use an email address almost identical to the actual address, besides one or two characters.
There have been reports of scammers phoning home buyers, impersonating solicitor’s account team members, and providing new bank account details where those deposits will be paid.
Check the account details provided at the start of the process and only use that. Refrain from relaying the details to the individual you’re speaking to and ask them to repeat their details. If in doubt, call the solicitor to double-check the original information before making any payments.
Similar to our buyer’s tips.
Double-check the seller’s solicitor email addresses when a new email is received.
There have been reports of scammers phoning solicitors, impersonating a seller’s solicitor’s accounts team member, and providing new bank account details where those deposits are to be paid.
Again, check the account details provided at the start of the process and only use that. If in doubt, call the seller’s solicitor to double-check the original information before making any payments.
Under a high-pressure environment, to get everything paid before the weekend, stay vigilant and avoid getting swept up in the stress. You’re more likely to fall victim to a FAF scam and ultimately end up in a much more stressful situation.