The New Zealand Law Society is warning lawyers to watch out for an email scam which involves payment of a fradulent cheque for a “matrimonial settlement” into law firm trust accounts. It is believed in this past week lawyers in New Zealand have already found they have lost significant amounts of cash in the confidence trick
Speaking to Geoff Adlam the Communications Manager at the Law Society we have learned that this long standing confidence trick that has been used widely in North America has now found its way to New Zealand.
Mr Adlam, talking to EmailExpert urged Kiwi Lawyers to be vigilant saying “We’ve had more reports of the scam in the last week. A lot of NZ lawyers are still away at the beach, but several firms have reported approaches this year. The firms which are caught out are understandably reluctant to reveal many details of their involvement… Firms right around NZ have been targeted, and the latest one got their cheque from Canada via UPS.”
The scam was first noticed in New Zealand in mid-2010. However it continues to target New Zealand law firms in 2011 with some lawyers already this year losing money. Law Society Inspectorate Manager John Munson says he knows of several New Zealand law firms which have lost money to the scam. “Unfortunately we’ve been contacted by some lawyers only after they have transfered money to the scammer. Our advice is that if something sounds too good to be true, it probably is.”
Initial contact is made by an email which asks a lawyer to act on the client’s behalf in a matrimonial settlement.
The settlement is always for a reasonably substantial amount of money and the lawyer is advised that the only action required is collection from the “reluctant” ex-spouse. Both parties always happen to be overseas, although one is allegedly normally resident in New Zealand.
Following an exchange of emails, the spouse finally agrees to pay. A cheque from a reputable foreign bank is received and deposited into the law firm’s trust account. The lawyer transfers the debt amount less their fee overseas, but discovers a week or so later that the cheque has bounced.
Mr Munson says that New Zealand lawyers should be very cautious when acting on behalf of foreign clients who make initial contact by email or letter.
“If lawyers have any doubts about the credentials or trustworthiness of someone who makes an approach from overseas, we strongly urge them to contact us. The Law Society is very happy to assist and provide advice.”