We all like to think we’re too savvy to fall for a scam, but the figures say otherwise.
Reports of fraud reached record levels during the pandemic with the Office for National Statistic’s (ONS’s) Crime Survey for England and Wales estimating four million cases in 2020 alone.
From online shopping and banking fraud to phone and text scams, it seems nothing and no one is immune from these increasingly sophisticated cons – and that includes home buyers.
A recent report revealed a spike in conveyancing fraud with one victim duped out of £640,000, prompting the National Crime Agency (NCA), National Economic Crime Centre (NECC), Action Fraud and The Law Society to issue new guidance on how consumers can best protect themselves.
Conveyancing fraud
Also known as payment diversion fraud or authorised push payment fraud, it may not be the catchiest but it’s certainly one of the most lucrative. And criminals are cashing in.
Typically, scammers will pose as a person’s lawyer in order to con them into transferring their house deposit or outstanding balance. Because the victim is tricked into authorising the payment, they are ultimately liable.
In the example given above, fraudsters intercepted emails between the victim and their solicitor, enabling them to gather information relating to the house purchase. They then used a spoofed email account, which was made to look like that of the solicitor, to request the exact amount the buyer was expecting to pay at the exact time they were expecting to pay it.
Not only did the sale collapse, but most of the £640,000 was never recovered.
Speaking as the new guidance was issued, John Shilland, fraud threat lead at the NECC, told conveyancers: “Payment diversion fraud is increasing and it is vital to be alive to the threat as criminals are targeting home buyers due to the scale of the transactions.
“Whenever a client is making a payment for a house purchase, they should be highly suspicious of any change in account details or new instructions. Remind them to always check with a trusted known contact, and if they have any doubt not to transfer the money.”
Simple steps to protect yourself
The government recently announced that it had set up a taskforce to tackle the sharp rise in scams including conveyancing fraud, which sees victims lose out on an average of more than £100,000.
But home buyers and sellers can also take steps to safeguard hard-earned savings from fraudsters.
Check the bank details
Request your law firm’s bank details over the phone or in person at the start of the conveyancing process and ask them to confirm them to you in writing by post.
If you’re making a payment for the first time, you could transfer a small sum to start with and then contact the firm to check it has been received.
If you receive an email or call stating that the bank details have changed, always check this by calling your conveyancer back on the number they have previously given you or one from their website.
Fraudsters can now use technology to spoof any number to appear on the caller ID display on your phone or, if you seem hesitant, may suggest you hang up and call back on a number they provide.
Make sure you’re secure online
Use a secure network when reading or replying to any correspondence relating to your house sale and not a public or unprotected Wi-Fi system, which criminals can easily hack into.
Install and regularly update anti-virus software on your devices and have strong and separate passwords for your accounts, also changing them on a regular basis.
Switch off social media
Moving house is a big deal but avoid shouting about it on social media until the contracts – and crucially, money – has changed hands. Fraudsters could see the post and, knowing you’re about to transfer a large sum, seek to target you.
Action Fraud
All conveyancers should be aware of the risks of fraud and communicate these to their clients. Sad though it is, this crime is on the rise and your default position should be one of suspicion to avoid becoming the next victim.
Read the new guidance in full here. If you think you have been scammed, contact your bank immediately and report it via the Action Fraud website or by calling 0300 123 2040.
Stephen Ward is director of strategy and external relations at the Council for Licensed Conveyancers
