Fraud Alerts

January 18, 2018

The Alberta Lawyers Insurance Association (ALIA) has learned of a scam that involves what looks like legitimate emails with a Dropbox attachment or link. Appearing to be sent from a known contact, this phishing scam email works in several ways by exploiting the popularity of the file sharing service. For more information, please visit the ALIA website.

October 31, 2017

The Law Society was informed about a recent fraud attempt on one of our Saskatchewan law firms that is considered unique (i.e., not the typical fraudulent cheque scam) and potentially disastrous in terms of the magnitude of monies that could have been lost.

In this case, there was both a legitimate client and valid real estate transaction. The client provided the law firm wire transfer instructions via email for the balance to close. The monies were to be paid from trust monies held by the firm to the seller’s bank account. These instructions were legitimate. However, shortly after this email, the firm then received a 2nd email from, what appeared to be the client, advising the firm that the bank account information provided previously was incorrect and that they would send the correct banking information shortly. Soon thereafter, the law firm received a 3rd email with new bank account information. Thanks to a keen eye, the firm noted that one of the names in the body of the email did not match the law firm’s records. So the firm telephoned the client to confirm the most recent instructions before any monies were paid out of trust. The client advised the firm that they had not sent the 2nd or 3rd email. This alerted both the client and the firm to the fact that the client’s email had been hacked and intercepted. As such, the firm advised the client they would only correspond with the client by telephone until the client’s emails were secure.

In order to avoid falling for such a fraud, the following controls/actions are recommended:

• discourage/eliminate the acceptance of wire transfer instructions from clients or other parties via email;
• confirm any change in banking instructions with the client/party by telephone using confirmed contact information from the law firm’s file (i.e., do not use contact information from the email);
• keep an eye out for inconsistencies in client emails when compared to prior correspondence (i.e., poor grammar, a beneficiary name that is not in the file, a foreign address, contact information that does not match your records, etc.)
  if a client’s email becomes hacked, cease to correspond with such client via email until their email is confirmed to be secure; and
• share the details of this scam with all firm staff.

Please be extra diligent when paying any funds from your trust (or general) bank account, but especially by wire transfer. It is extremely unlikely, if not impossible, to reverse a wire transfer, even in cases of fraud.

If you have any questions, please contact the Law Society Auditors at (306) 569-8242.

October 25, 2017

It has been reported that a number of members have been contacted by someone wishing to retain their services for the enforcement of spousal and child support payments.

The details regarding this contract (subject to change, of course) are as follows:

Names: Martha Herrera/Martha Bildy, Nicholas Bildy
Email address: [email protected]
Total amount: $918,500
Outstanding amount: $672,900 to be collected
Phone Number: (505) 445-8614 (no answer)
Copies of emails received by members and the referenced “Separation Agreement” are attached.
Please beware that this is a scam and advise others in your firm accordingly.

October 5, 2017

Two fraud alerts have recently come to SLIA’s attention. The AvoidAClaim blog, created by LawPRO, offers daily insights on claims prevention and practice management, and warning about current frauds targeting lawyers. SLIA recommends members read a recent post, Recognizing the red flags of real estate scams involving corporate identity theft. Please also see the alert Fake Trust Account Auditor Scam from Alberta Lawyers Insurance Association (ALIA).

October 3, 2017

From Alberta Lawyers Insurance Association: Fake Trust Account Auditor Scam

September 29, 2017

The Law Society has been advised that two law firms have received Phishing emails containing an attachment. Please be very careful about opening emails with attachments. Extra caution is required in cases where the subject line is suspicious, the email is unexpected and unrelated to a known matter or there are spelling errors in the subject line or within the body of text.

In both recent cases involving Saskatchewan law firms, the malicious email presented as being sent from another lawyer, making it appear safe to read and safe to open the attachment. If you receive an email that appears to be from another lawyer or law firm that is unexpected, contains no specific file reference or contextual information, and is inviting you to open an unknown attachment or link, it may not be legitimate. If you are unsure about a specific email that has suspicious characteristics, best practice is to phone the sender to confirm if he or she actually sent you the email.

September 20, 2017

Further to the fraud alert posted on May 1, 2017, a number of firms advised that they have been contacted by someone using this scam; however, there is a new development.

It appears the scammer is now using a similar domain used by the law firm; for instance, if a law firm uses the email address [email protected], the scammer will use a similar email address, such as [email protected].  The Law Society advises members to be extra cautious regarding emails that request a transfer of funds.

September 15, 2017

We are circulating an article about a fraud perpetrated on a lawyer in Ontario who hired an individual pretending to be a lawyer. It illustrates the importance of checking the credentials of a student at law or lawyer to ensure that they have active status with the Law Society when hiring.

He turned his fake degree into a weapon’: Man posing as a lawyer tricks clients out of thousands (Source: CBC, www.cbc.ca)

May 1, 2017

We were recently advised by a member about a new scam that is being circulated.

This one is significantly different from previous scams, in that the email is addressed to a real person on your staff (i.e., office accountant), using your name as the sender, but with a different email address. The email asks your office staff to “process a payment” to a vendor with details to follow. Details are subsequently provided and requests that monies be wired to the Bank of America, giving routing numbers, etc. Please see copy of the original email received by the firm reporting the scam.

January 11, 2016

A scammer recently attempted to have a member receive a fraudulent cheque into trust and pay out the proceeds before the cheque could be verified as fraudulent. Details…

March 6, 2015

A Saskatchewan law firm was recently contacted via email by someone from the Netherlands in search of a lawyer to assist in the drafting of a purchase and sale agreement with a buyer residing in the local area. To protect yourself from being a victim of such scams, please review the notice and emails.

August 27, 2014

Scam Involving Counterfeit Cheques

January 10, 2013

Over the last few weeks, scammers have been very busy and successful.

One scam resulted in a “large 6 figure” shortfall in the trust account of a Toronto law firm. This shortfall occurred when the law firm’s trust account was “hacked” by the fraudsters. Law Times provides further details on how this scam was carried out. All members and appropriate firm employees should be made aware of this scam and precautions taken to prevent similar occurrences in Saskatchewan.

This link also reports that another Toronto lawyer fell victim to an adaption of the old “Nigerian” scam. These scams are getting much more sophisticated, so please continue to be on the alert. Pay particular attention when funds are being received from U.S. or other foreign sources, because although the bank draft, certified cheque, etc. received may appear legitimate, it can take months before the foreign banking systems determine the item is a fraud and alerts your bank at which time the deposit to your trust account will be reversed, leaving you with a shortfall.

In addition, Slaw provides names of 4 fake law firms (3 purported to be in Toronto and 1 in Ghana), which have been tied to an international inheritance scam. Please review these links so that you are prepared if you and/or your firm is targeted. These sites (LawPro and Slaw) are good ongoing resources for scam/fraud updates and research.

If you have any suspicion that a transaction may not be legitimate, go slowly. Be sure that all client identification/verification requirements are met. Contact John Allen, Auditor/Inspector, at the Law Society before paying monies from trust if you still have concerns (569-8242).

January 30, 2012

A member of the Law Society of Saskatchewan and a member of the Law Society of Alberta were recently contacted as part of 2 similar scams. Although neither attempt was successful these scams have a bit of a different twist. Please see details (for members only).

August 25, 2011

The plaintiff, the Bank of Montreal, carries on business in Calgary and elsewhere across Canada. The defendants, who are too numerous to mention, and are outlined in the Style of Cause of the Statement of Claim, are individuals, realtors, appraisers, lawyers and corporations who are alleged to have been a part of, and in some cases, benefited from fraudulent mortgage/real estate schemes.

June 20, 2011

The Law Society has recently been advised of a new wave of trust account frauds. Note this is a fraud, and not a scam, in that bogus cheques are prepared by the fraudsters using the lawyer’s trust account information. The bogus cheques (usually in amounts of less than $20,000) are then cashed (deposited) by the fraudster with the hope that they will be honoured by the financial institution. Read more…

April 4, 2011

Deposit of Trust Cheques Written on U.S. (Foreign) Accounts

Lawyers should be aware that cheques written on United States bank accounts (including cashier’s cheques) can take one or two months or even longer to clear, particularly if they are drawn on a smaller U.S. bank. If the cheque is found to be fraudulent (2 or 3 months later), the system will automatically withdraw the funds from your trust account, leaving a deficiency in your trust account and you will be responsible for making up the shortfall.

The key here is that the clearing system for cheques in the U.S., and no doubt in some other foreign countries, is much slower than here in Canada and scammers try to use this to their advantage.

Scammers recently tried to use this delay in an unsuccessful scam attempt in Saskatchewan. Thanks to the alertness of a couple of our members and their staff, this scam did not work, but be aware of the M.O. as the names, amounts and remitters will change in the future, but the M.O. will be similar.

This scam was similar to previous scams in that:

• The member was approached via email or phone;
• The member was to collect monies owing to the scammer;
• Once monies were received and deposited to trust, the member was to wire part of the funds to the client’s bank account (either inside Canada or in a foreign country), in this case Japan.

In this case, the scammer was “owed monies for an injury and disability resulting from an accident on the job” in Canada. The scammer had signed a Settlement Agreement and General Release prior to contacting the member. According to the scammer, 2 payments had been received, but the rest was overdue and the member’s services were required to collect the remainder.

Sounds familiar so far. Now the wrinkle.

The company involved and owing the funds is from the U.S. The monies received by the member were in the form of a “Cashier’s Check” drawn on a U.S. bank. (see images of Cashier’s Check and scammer’s passport)

These Cashier’s Checks were deposited to the member’s trust account on February 14, 2011, but the member was not advised until March 16, 2011 (over a month later) that the cheques had “bounced.” Bottom-line, the cashier’s cheque was fraudulent.

Defence in Addition to Standard Procedures

• Make sure you receive independent verification that the company writing the cheque is legitimate.
• Check with the company that wrote the cheque to make sure the cheque is legitimate.

May 17, 2010

A number of members have been approached with the latest scam whereby a divorced woman from the US seeks help from a law firm in Canada to obtain funds owed by her ex-husband who lives in Saskatchewan. Please see excerpts from the actual emails between the fraudster and one of our members.

August 21, 2009

Beginning in October 2008, a number of Fraud Alerts were circulated by John Allen, CA regarding lawyers trust accounts. Please read the attached Fraud Alert Update, as well as well as a Press Release from the RCMP.

March 6, 2009

The Law Society of British Columbia has provided notice to the profession of a new scam in that province. We have had no indication of any Saskatchewan connections at this time.

November 24, 2008

The following scam was recently attempted in another province. We do not have all the details yet, but we understand it was intended to work as follows:

• A member is contacted by phone to act for a purchaser of real estate.
• The purchaser is from out of the country, and in this case, overseas, but the member deals with a person in Canada acting on the purchaser’s behalf (i.e., a relative).
• Fortunately, the member asked the purchaser to comply with the new proposed Rules on Client Identification (i.e., provide a certified copy of passport, etc.). The required identification was never received.
• The Canadian contact stated that copies of identification would be difficult to obtain because the client was ill and receiving medical treatment in Germany.
• Another lawyer was acting for the vendor and a realtor was involved.
• The member received a fraudulent cheque for the amount of the purchase. The cheque could be from a bank, mortgage company, or anyone, since it is a forgery.
• The member deposited the fraudulent cheque and was contacted soon after by the clients’ family member advising that the client had passed away and requesting the return of monies (from trust), presumably, by wire transfer. This transpires in a timely manner; before the member becomes aware that the original cheque was fraudulent.

Further details will be provided as they become available, but please note that this is fraud, and as with other scams, this will no doubt take on many forms as the fraudsters attempt to get your trust money.

In the meantime, if you are contacted by anyone with this type of scam, please advise John Allen, CA at the Law Society office at 569-8242.

October 16, 2008

There is a new scam out there that is much harder to detect than those previously received  by members. I am attaching information (cover letter and invoice) received by a member in regard to this scam for your information and it is worthy to note that:

1. The names used are very close to legitimate companies.
2. The email address in this case is “live.com”. This type of address “hotline, yahoo” etc is a warning sign to be on the alert.
3. As noted by the member below, this scam originated with a cold telephone call and was then followed up with the email
4. An internet search for the company revealed a similar corporation but that corporation was doing a different type of business.
5. This letter is far more professional than those rec’d on previous scams

The names and locations of the corporations under suspicion are:

• Genentech Engineering – New York
• Devlan Construction – Nova Scotia
• Maxwell China Ltd. – China

I have also been advised by another lawyer that he has received numerous emails, faxes and at least one phone call on a scam similar to the one described above and in the attachment. The information provided below came directly from the lawyer contacted.

This began with a cold call on the telephone followed by this email two days later.