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Homebuyers losing thousands of pounds intended for solicitors

SRA chief warns that the number of online payment scams is on the rise

7 January 2016

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Homebuyers are losing money hand over fist as fraudsters intercept online payments destined for solicitors' accounts.

A couple who saved £45,000 to buy their first home fell afoul of the scam after they paid money into a fake Barclays bank account on behalf of a conveyancing firm.

Speaking on the Victoria Derbyshire show this afternoon, the Solicitors Regulation Authority (SRA) chief executive, Paul Philip, said: 'In December last year we reported ten cases of such scams. It is unfortunately becoming really quite common.'

The City of London police said that between 1 January 2013 and 31 October 2015, the average loss for reported incidents was £112,310, the BBC reported.

Peter Rodd, a senior partner at Boys & Maugan, said practitioners were aware of the problem and urged greater awareness of how to combat the dangers.

'What we need to try and do is educate ourselves and our clients, as consumers, to the nature of the risks that exist and the ways in which people can protect themselves,' he added.

Rodd continued that homebuyers should regard a change in a solicitors' account details with the 'greatest suspicion' as they will 'very rarely change their bank account'.

With more threats than ever to cybersecurity the Boys & Mauga lawyer warned clients of the threats to their personal computers.

'Clients themselves don't have adequate protection on their own computers or laptops and if criminals are able to download malware then that will enable the criminal to access that client's email and send bogus emails to them,' he said.

Philip also gave guidance for those considering buying a new home.

'They [solicitors] don't send unencrypted emails or ask for personal data by email. If you are a client and you get an unsolicited email or something that looks odd, you pick up the phone and verify with the solicitor that that email has come from them or you say that you're not prepared to give the information by email.'

Rodd added: 'Solicitors should not be sending clients completion statements by emails. Solicitors should warn that there are fraudsters around. Payment details should come by post and telephone, not by email.

'Solicitors should encourage their clients to verify those details by calling the solicitors before making a payment.'

Asked by the BBC whether clients are protected against such malpractice, Philip replied: 'If it can be found that the solicitors are at fault, if their system has been hacked, if we find that they have failed to take proper measures to protect client's information or client money, then solicitors indemnity insurance will cover them.

'Failing that they [the client] can actually come to the SRA and we can consider compensating them for their loss.'

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