Internet scammers have recently been targeting lawyers and law firms by posing as a potential “client” from a foreign country who is need of a U.S. attorney. The situation has become frequent enough for the FBI to conduct on-going investigations. These “clients” use sophisticated tactics to scam even the most prudent attorney. Since the scams are relatively new and have yet to be highly publicized, many attorney are ill-prepared to protect themselves.
The most common scenario is that the attorney will receive an email from an off-shore individual or company requesting legal representation to collect delinquent accounts in the U.S. The majority of the “clients” are from Korea, China, Ireland and Canada. Often, they will list a referring attorney or a Bar Association as a contact. The scammers have gone so far as too post fake blogs and websites for the referring attorney, which leads attorney to assume the referral is legitimate. Once a retainer and/or fee is agreed upon, the scammer send the attorney a cashier’s check from a seemingly reputable bank, on behalf of the new “client.”
Additionally, they also send an invoice purporting to reflect monies owed to them from the debtor. The scammer then quickly requests that the attorney send back the remaining funds, minus attorney fees. If the scammer is successful, the attorney will send the funds when the bank claims that the funds are available, but before they discovers it is counterfeit (some banks will make the funds available before the check technically clears.) The off-shore account is then closed and cannot be traced to the scammer.
Another, but less common, scenario is that the scammer poses as a prospective client and requests the firm’s bank information to transfer the funds. In this case, the scammer will hack directly into the attorney’s account and remove the funds.
Although, the above situations may seem to be obvious scams in retrospect, many attorneys have fallen victim. Some precautions that you can take to avoid the same fate include:
- Independently obtain more than the contact information the “client” provides. That is, do not just rely on the information they give you.
- If the “client” appears to be internationally based, run a background check and research them extensively. If they present an attorney referral, do more than a simple internet search to confirm legitimacy.
- Be aware if the “client” claims they were referred by a Bar Association, as they very rarely give referrals to Be aware, if the client claims they were referred by a Bar Association, as they very rarely give specific referrals to attorneys.
- Deposit the check into an escrow account completely separate from your firm’s trust account.
- Do not accept any checks from off-shore clients. Instead, have them wire the money directly into your firm’s account and avoid turning over any pertinent information regarding your account. This will ensure the funds are legitimate and accessible immediately.
- Ask yourself if there is any valid reason to be paying the client at all.
- If you believe you have fallen victim to a scam, contact the Internet Crime Complaint Center at http://www.ic3.gov. Keep in mind that there is no breach of lawyer’s duty of confidentiality at this time, as the Legal Ethics Committee has yet to offer an opinion on this situation. There is no “reasonable expectation of confidentiality” since the communications are being used to obtain the money under false pretenses.
Authored by Nicole Shoener, LegalMatch Staff Legal Writer