“Cyber blind” home buyers are unaware of the risks cyber criminals pose when buying a property, potentially leaving themselves open to fraud when transferring the cash to complete the sale, new research has found.
According to the latest Home Moving Trends report published by tmgroup in partnership with the Property Academy a staggering 83% of home movers are “cyber blind” to the risks posed by fraudsters when transferring their money to a conveyancer when they buy a property.
It is commonly known as “Friday afternoon fraud” as this is the time criminals typically target transactions before they go through ahead of the weekend.
Worryingly, only 17% of buyers consider transferring funds to their conveyancer to be a high risk phase of the property transaction.
The survey, which questioned over 14,000 people, found that 46% of home movers don’t think they heard about cyber security risks from their conveyancer – despite claiming to have read every word of their documentation
The report warned that is was no longer enough for conveyancers to simply include fraud and cyber crime messages in their welcome packs and assume that their clients are reading them.
Paul Albone, managing director at tmgroup, said: “With ever-savvier cyber criminals targeting the conveyancing world, assuming that every client is aware of every risk is no longer an option.
“As these statistics reveal, conveyancers need to be mindful of the fact that it is their responsibility to convey these risks to their clients – not merely as a conveyancing exercise, but in an attempt to eradicate this kind of fraud from the market, and reduce the level of risk to their firm, their reputation and their bank balance.”
Scams
The majority of scams fall into two categories. They typically involve firms receiving calls from fraudsters pretending to be banks to obtain sensitive information, such as account passwords.
Another way con-artists get hold of information is by intercepting emails between clients and firms, leading to client funds being paid into fraudsters’ accounts.
This is against a backdrop of continued instances of con-artists pretending to be solicitors, using either fake names or stealing the identities of genuine firms.
The scale of the threat cybercrime poses is evident in figures from the National Fraud Intelligence Bureau which show that people buying and selling homes had £10 million stolen from them between January 2013 and October 2015 after having their emails hacked.
The Bureau recorded 91 victims of conveyancing fraud, with each one averaging more than £112,000.
Police do not know who are behind the frauds, but it is believed organised gangs from abroad are responsible. Fraudsters use malware to hack into the emails of homebuyers and solicitors, allowing them to monitor the correspondence. They then wait for the transfer of deposits to happen at completion or exchange and then strike.
A homebuyer might receive an email from the solicitor asking them to put the money in a new bank account. Not suspecting anything is wrong, the homebuyer deposits the money, which the fraudsters then take.
Cybercrime issues affecting solicitor firms are also on the increase, the Solicitors Regulation Authority has warned. It has reported that that more and more firms are falling victim to fraudulent activity or being contacted by scam artists, which can have serious consequences for those buying property.
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