The ongoing cost of living crisis in the United Kingdom has left many individuals financially squeezed and increasingly vulnerable to scams. Now with inflation mounting and household budgets growing increasingly pinched, scammers are looking to exploit your desperation. They employ numerous strategies to scam victims out of their hard-earned cash. According to reports, these scams can involve amounts as low as £100. Conversely, they can go to truly transformative amounts in the six-figure range. Tragically, victims are sometimes fleeced out of their entire life savings.
Cyber-attacks today represent a shocking 75% of all crime reported to police in the UK. In recent years, law firms have emerged as juicy, irresistible targets for these scammers. These firms often manage substantial financial transactions and possess confidential information about their clients, making them prime targets for cybercriminals. The Covid pandemic drove speedy remote communication between solicitors and clients. This change has been blamed for an increase in conveyancing fraud, or as it is sometimes called, “Friday afternoon fraud.” Scammers like hitting people on Friday afternoons. They like to surprise victims, banking on the fraud not being found out until law practices open on the next Monday.
Consumers are advised to be suspicious if they receive unexpected messages claiming to be from their conveyancing practice. The Federal Trade Commission has received complaints about scammers changing scheduled payment dates or other payment information at the last minute and even posing as new company employees. As legal expert Arun Chauhan explained, there are huge complications involved with obtaining compensation after these kinds of scams.
“That does not mean a law firm will accept that they are liable to compensate,” – Arun Chauhan
These banks have signed up to reimburse scam victims who are not at fault from excessive carelessness through the industry’s contingent reimbursement model (CRM) code. This commitment doesn’t guarantee that each person will receive their funds. If a bank has not signed up for the CRM code, the victim may need to pursue a professional negligence claim against the conveyancing firm. Left unchecked, this process entails deep and unwarranted costs.
A recent piece of research from the Solicitors Regulation Authority (SRA) found some pretty shocking figures about cyber-attacks against law firms. Of the 40 firms surveyed, 30 English law firms admitted to being the victim of at least one cyber hack. The total economic damage from these attacks ended up resulting in a total combined economic damage of £4 million. Despite these numbers, companies like Chase and Wells Fargo are often served lawsuits for not doing enough to notify customers of the danger of online scams.
Hundreds of people have come forward to tell their stories about being duped by these nefarious schemes. Hall, a victim of a false lottery scam, said she couldn’t believe what was happening to her.
“I’m always wary of scams. I can’t believe this has happened to me,” – Hall
Hall’s financial loss as a result of a sophisticated scam, posing as official communication from her bank. Lucky for her, she reported her case early on and had the support from Chase Bank who was able to assist with getting her reimbursed right away.
“They were extremely helpful … and said they would try all they could to get the money back. Within a few days, I had all the money lost from Chase back in my account,” – Hall
Hall said she was particularly frustrated with her former bank, Halifax, for not caring enough about customers’ safety.
“If Chase can do it [give her the funds back], I don’t see why Halifax can’t,” – Hall
Some other victims feel the same way. They argue that banks need to be held more accountable for protecting their customers’ fraud. Halifax’s spokesperson admitted that justice was out of reach for too many victims while invoking the organization’s commitment to examining every case.
“We have a great deal of sympathy for [Hall] as the victim of a scam. We carefully review the individual details of each case reported to us and then consider a number of factors, including whether the bank could have taken any additional steps to help prevent the scam taking place, and also if our customer took reasonable care when making payments,” – Halifax spokesperson
In another harrowing account, Andrew White disclosed that he lost his entire retirement savings after falling victim to a scam while purchasing a home to be closer to his family. No surprise then, that his story resonates with so many. They too have been victimized by the emergence of predators preying upon the worst economic times.
“I lost my entire retirement money through buying a house to be closer to my family,” – Andrew White
Banks and financial establishments are under constant pressure to make their networks and infrastructure more secure. They should be doing more to warn people about scams, as fraud concerns soar. HSBC’s spokesperson underscored the bank’s commitment to preventing fraud while protecting customer choice.
“Protecting customers from unscrupulous fraudsters is a priority for us. The customer has been reimbursed in full,” – HSBC spokesperson
We know that fraud tactics and technologies are ever-changing. Consumers need to be on guard to defend themselves from bad actions. It is critical that financial institutions take a proactive step to defend their clients against these kinds of threats. Finally, they need to do better informing us of risks.