November 13, 2017
Spear Phishing Season Extended: Phony “Direction to Pay” Scams Continue
ALIA has received additional reports of fraudulent emails being sent to lawyers in Alberta and other jurisdictions. In these scams, the fraudsters pose as individuals working in law firms or as clients/clients’ lenders, with the goal of tricking lawyers into transferring trust funds to them.
In an example of a “direction to pay” scam, the fraudster “spoofs” a lawyer’s email address, making it appear that the email is sent from that lawyer by displaying their actual name in the “From:” line. The email asks another lawyer or staff member to transfer funds on some pretext such as urgency, the need for extreme sensitivity or because the lawyer is away.
In the phony “change in payment instructions” scam, the fraudster sends revised payment instructions by email from someone that the lawyer or law firm believes is the client. In both cases, the emails may be very convincing, so due diligence is a must before transferring any funds out of a trust account.
Action to be taken:
If you or your law firm receive any request to transfer funds or any change in payment instructions, consider the possibility that a fraudster is at work. Ensure that the instructions are legitimate through direct, in-person contact with the client by verified client contact information. We also recommended that your firm establish protocols for transferring funds and adhere to them.

Further, if you receive communications from any unauthorized person seeking to access trust funds, please send an email to the ALIAlert mailbox and, if possible, provide the potential fraudster’s contact information.

The Alberta Lawyers Insurance Association provides the ALIAlert service to all Alberta lawyers participating in the insurance program. If you believe that you have been targeted by potential fraudulent activity, please contact ALIAlert so that we may alert other members of the profession and avoid losses that increase the cost of everyone’s insurance.