The scale and sophistication of fraud committed via the internet is expanding rapidly. Property transactions are particularly attractive because of the large sums of money which can be syphoned off through one simple alteration.
Many readers will already have heard of stories where house buyers, sometimes through their solicitors, send money to a fraudster thinking that they are sending it to a solicitor, or where the solicitor believes he is sending proceeds of sale to his client and instead benefits the fraudster.
It is clear that both clients and their solicitors need to treat this area with the utmost caution. Both parties need to check bank account details carefully and as safely as they can, possibly making arrangements to send a small amount of money to check the destination before sending the majority.
“Professionals advising on property transactions are under ever-more stringent obligations to carry out client-identity checks.”
Unfortunately, this is likely to lead to more procedures which may often be seen as tiresome. Professionals advising on property transactions are under ever more stringent obligations to carry out client identity checks when first instructed and to carry out ongoing monitoring of the parties to a transaction as it proceeds. For some long-standing clients, this may require them to provide their identity documentation to their solicitor on each new transaction.
Corruption clampdowns and the Panama Papers are in the news at present, reflecting a changing world where client identity and fraud detection measures are only moving higher up the public agenda.