by Dave Bilinsky, Practice Management Advisor
with assistance from Paul Willms, Assistant Manager, Audit & Investigations
Scams to look out for
Anyone who uses email probably finds internet scams hard to miss, but you may not be aware that many schemes are specifically targeted to lawyers. Study up to ensure you know how to avoid some of the common scams and suspicious schemes that we have seen attempted on lawyers in 2006.
No obvious legal services
A “registered investment advisor” forwarded an email to a lawyer’s office soliciting “receivables clerks/associates” to “receive the investment funds from our clients into your designated account, reconcile the payments if required and transfer the funds into our investment accounts… You will receive a three per cent commission from the gross amount of each transfer that you forward to us.” This scheme tries to involve the lawyer in a fraud perpetrated on investors. The key feature is that little or no legal service is being rendered and the lawyer’s only function is to provide a trust account transfer point.
A BC lawyer received a fax purporting to be from the US Internal Revenue Service advising that he was a “non-resident alien” and asking him to complete the accompanying form. The fax appended a bogus document — similar to a standard IRS form — that asked for his name, date of birth, banking details and other personal information. The scam was designed to facilitate identity theft and to make it possible to access the lawyer’s bank accounts.
Processing fee scam
A lawyer received, via email, a letter purporting to be from a law firm in Malaysia. This letter requested the lawyer’s assistance in “distributing the money left behind by my client before it is confiscated or declared unserviceable by the bank where this deposit valued at $19 million is lodged. The bank has issued me a notice to contact the next of kin, or the account will be confiscated.” The recipient lawyer did not follow up on the letter; however, if he had, the Malaysian “lawyer” would have doubtless required some up-front “good faith” processing fees prior to the release of the alleged funds.
Nigerian letter scams
We have seen numerous variations of the Nigerian letter scam. This swindle usually involves a request for assistance in transferring a large sum of money in exchange for a large payment. The victim is asked for an up-front “good faith” payment and the con artist quickly disappears. The fact patterns in this con are often designed to evoke both sympathy and greed in the victim. Some examples include a widow looking for assistance in transferring millions to charity, a BC lawyer in England trying to locate the beneficiaries of a $12 million estate and, with no hint of irony, a bank employee who was simply looking for a BC lawyer willing to set up a bank account so he could steal several million dollars from a dead man’s account.
A fraudster attempted to negotiate a forged trust cheque. This particular individual went to the extent of setting up a 1-800 number and listing it in the payer portion of the cheque in the event someone called to verify the cheque’s authenticity. Fortunately, in this case, the bank inquired directly with the lawyer and the fraud was unsuccessful.
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These are just some of the examples drawn from our files. We have seen many other attempted frauds and scams following similar scenarios of tragic deaths, exorbitant amounts, missing beneficiaries, oppressive currency laws and others. A lawyer is well advised to be on guard. “The error of Diogenes lay in the fact that he omitted to notice that every man is both an honest man and a dishonest man.” (G.K. Chesterton)
No lawyer wants to be taken in by someone who is still running today.