Fraudsters and Scammers Are Still Targeting Lawyers – Including You (Part II)

anti-fraudPart I explained the types of check scams targeting lawyers, and how they work.  This post explains how you can avoid being victimized by these scams.

The Oregon State Bar Professional Liability Fund (OSBPLF) offers 11 tips to avoid being scammed. If a new client passes your initial screening, protect yourself by following these steps before depositing his or her check and wiring funds from your account:

“-Call the issuing bank branch of the check to verify that the check is legitimate. Use the phone book, the bank’s Web site, or directory assistance to obtain the phone number of the issuing bank branch. Do NOT use the telephone number print­ed on the check – it could be fraudulent.
-If the issuing bank will not or cannot verify the authenticity of the check, ask your bank to call the issuing bank and make this inquiry before de­positing the check into your trust account. It helps to have a good relationship with your banker.
-If you cannot verify that the check you have is legitimate, consider terminating the legal representation of the client or waiting until the check has cleared and the funds are not subject to a chargeback. Instruct your bank to notify you immediately if it suspects fraud.
-Verify money orders by calling the issuing company. Keep in mind that scammers might use a legitimate number on numerous money orders, so there is no guarantee that the money order is legitimate.”

Clearly, the best way to avoid being defrauded is to have a good client screening process, follow sound procedures for disbursing funds from your client trust account, and learn to spot and avoid scams.

What if you do all of that and still get scammed? That’s where insurance comes in.

Your legal malpractice policy may cover your loss, unless it has an exclusion for claims that involve handling funds, or it covers only claims that involve the rendering of legal advice, i.e., it doesn’t cover claims involving the business aspects of law practice, such as those pertaining to your trust account.

Another option is to purchase crime coverage, which will likely cover you for the fraud described here, as well as computer and many other types of fraud, employee dishonesty, etc.

A skilled broker will make sure that you’re covered for this exposure.


Fraud Fact Sheet: Don’t Become the Next Victim 
Scammers Aim at Lawyers: How to Avoid Becoming the Next Victim 
Scam Update: New Ways They Can Get Your Money
Lawyer Email Scams: How The Nigerian Scam Is Used On Lawyers 
Massive Spike in Bad Cheque Frauds Targeting Lawyers Worldwide 
Frauds Targeting Lawyers Continue at High Level: Don’t Be Duped 
How to Report (And Stop) Fraud Attempts Using Gmail, Yahoo and Hotmail Addresses

For hundreds more links on this and related topics, visit Firm Risk Management Linkbrary 

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