August 21, 2017
Loan Settlement Scam
An Alberta law firm has reported a new variation of the bad cheque scam . The fraudster sent a letter by registered mail to a lawyer at the firm enclosing two cheques, made payable to the firm, which appeared to have been issued by a real company. The letter advised that the cheques were for the partial settlement of a loan from an individual identified as a client of the firm who had authorized the remittance of the payment to the firm. The letter also advised that the guaranteed funds should be available within three days of depositing the cheques and included a retainer fee to pay the lawyer.

The firm recognized several red flags of fraud including that it did not have a file involving any of the parties named in the letter and that the cheque numbers on the two cheques were the same. The firm confirmed with the bank that the cheques were fraudulent.

ALIA recommends that lawyers and their staff be aware of and on the lookout for the red flags of fraud. Lawyers should also review processes involving firm bank accounts to ensure that appropriate measures are implemented to prevent fraud. Lawyers should seek confirmation from the bank that any incoming funds have cleared prior to issuing a trust cheque.

The Alberta Lawyers Insurance Association (ALIA) provides the ALIAlert service to all Alberta lawyers participating in the indemnity program. ALIA does not independently confirm the facts or allegations provided to us. If you believe that you have been targeted by potential fraudulent activity, please contact ALIAlert.