Cybercrime targeting lawyers and conveyancers on the rise

By Sharan Gill, General Counsel, Law Mutual (WA).

Another major cyber fraud involving a solicitor in Western Australia shows that solicitors and conveyancers are still very much at risk of email fraud during property transactions.

In a recent case, a family law practitioner’s email account was compromised, with the fraudster impersonating the lawyer to persuade a client to pay $650,000 into the fraudster’s bank account.  Fortunately, the scam was exposed before any of the $650,000 was transferred out of the fraudster’s account, and the funds are now being returned to the client.

The frequency and level of sophistication in cyber fraud is increasing all the time. Last month, the Australian Federal Police issued a Cybercrime Alert specifically referencing the increase since December last year Business Email Compromise (BEC) scams involving the impersonation of conveyancers to cause the redirection of clients’ funds into fraudsters’ accounts.

Law Mutual strongly urges practitioners to review the recommendations in our most recent alert concerning:

Verification of the solicitor’s bank details

1. Advise clients in writing at the beginning of the retainer to telephone the solicitor’s office to verify their trust account details before transferring any funds;
2. Advise clients in writing at the beginning of the retainer to obtain the solicitor’s telephone number from a verifiable source, such as the solicitor’s website, and not rely on a number contained in emails and pdfs, especially those which contain bank details.

Verification of client and third-party bank account details

1. Telephone the client or third party, using a telephone number reliably sourced, to verify the bank details;
2. Create a form which requires the source of the telephone number and the details of the verification to be recorded for possible future reference.

Cyber security measures

1. Adopt appropriate cyber-security measures and refer to the Essential Eight;
2. Refer to the Cyber Precedent (a Law Council of Australia resource) for further protective measures.

Taking these measures will mitigate the risk of you being the subject of a BEC scam and, if you are, it will mitigate the risk of liability in a professional negligence claim.