Law Firms Are Target For Counterfeit Check Schemes

FBI Receive Reports Of Counterfeit Check Schemes Targeting U.S. Law Firms...by Jack Swint

According to the Federal Bureau of Investigation, a scam that first surfaced in 2010 has resurfaced again in March 2012 targeting Law Firms across the US.

Scammers are contacting lawyers via e-mail, claiming to be overseas and requesting legal representation in collecting a debt from third parties located in the U.S. The law firms receive a retainer agreement and a check payable to the law firm. The firms are instructed to deposit the check, take out retainer fees, and wire the remaining funds to banks in China, Korea, Ireland, or Canada. After the funds are wired overseas, the checks are determined to be counterfeit.

In a slight variation of the scheme’s execution, the victim law firm receives an e-mail from what appears to be an attorney located in another U.S. state requesting assistance for a client. The client needs aid in collecting a debt from a company located in the victim law firm’s state. In some cases, the name of the referring attorney and the debtor company used in the e-mail were verified as legitimate entities and were being used as part of the scheme. The law firm receives a signed retainer agreement and a check made payable to the law firm from the alleged debtor. The client instructs the law firm to deposit the check and to wire the funds, minus all fees, to an overseas bank account. The law firm discovers after the funds are wired that the check is counterfeit.

Another approach is the fraudulent client seeking legal representation posing as an ex-wife “on assignment” in an Asian country, and she claims to be pursuing a collection of divorce settlement monies from her ex-husband in the U.S. The law firm agrees to represent the ex-wife, sends an e-mail to the ex-husband, and receives a “certified” check for the settlement via delivery service. The ex-wife instructs the firm to wire the funds, less the retainer fee, to an overseas bank account. When the scam is executed successfully, the law firm wires the money before discovering the check is counterfeit.

Law firms should use caution when engaging in transactions with parties who are handling their business solely via e-mail, particularly those parties claiming to reside overseas. Attorneys who agree to represent a client in circumstances similar to those described above should consider incorporating a provision into their retainer agreement that allows the attorney to hold funds received from a debtor for a sufficient period of time to verify the validity of the check.

Timeshare Marketing Scams

Timeshare owners across the country are being scammed out of millions of dollars by unscrupulous companies that promise to sell or rent the unsuspecting victims’ timeshares. In the typical scam, timeshare owners receive unexpected or uninvited telephone calls or e-mails from criminals posing as sales representatives for a timeshare resale company. The representative promises a quick sale, often within 60-90 days. The sales representatives often use high-pressure sales tactics to add a sense of urgency to the deal. Some victims have reported that sales representatives pressured them by claiming there was a buyer waiting in the wings, either on the other line or even present in the office.

Timeshare owners who agree to sell are told that they must pay an up front fee to cover anything from listing and advertising fees to closing costs. Many victims have provided credit cards to pay the fees ranging from a few hundred to a few thousand dollars. Once the fee is paid, timeshare owners report that the company becomes evasive—calls go unanswered, numbers are disconnected, and websites are inaccessible.

In some cases, timeshare owners who have been defrauded by a timeshare sales scheme have been subsequently contacted by an unscrupulous timeshare fraud recovery company as well. The representative from the recovery company promises assistance in recovering money lost in the sales scam. Some recovery companies require an up-front fee for services rendered, while others promise no fees will be paid unless a refund is obtained for the timeshare owner. The FBI has identified some instances where people involved with the recovery company also have a connection to the resale company, raising the possibility that timeshare owners are being scammed twice by the same people.

If you are contacted by someone offering to sell or rent your timeshare, the FBI recommends using caution. Be wary if a company asks you for up-front fees to sell or rent your timeshare. Read the fine print of any sales contract or rental agreement provided. Check with the Better Business Bureau to ensure the company is reputable.

Grandparent Scam Is Back

The FBI is warning citizens to be aware of the resurfacing of the "Grandparent Scam" -- a con that targets elderly people and can cost them thousands of dollars. This scam goes something like this...

You're a grandparent, and you get a phone call or an email from someone who identifies himself as your grandson. "I've been arrested in another country," he says, "and need money wired quickly to pay my bail. And, oh by the way, don't tell my mom or dad because they'll only get upset." The perpetrators are now using the Internet and social media websites like Facebook to research potential targets, the FBI warns. For example, the actual grandson may mention on his social networking site that he's a photographer who often travels to Mexico.

When contacting the grandparents, the phony grandson will say he's calling from Mexico, where someone stole his camera equipment and passport," the FBI reported in a press release on Monday. Other common scenarios the Bureau has witnessed include: A grandparent receives a phone call or email from a "grandchild." If it is phone call, it's often late at night or early in the morning when most people are not thinking clearly. Usually, the person claims to be traveling in a foreign country and has been arrested, involved in an accident or mugged and needs money wired ASAP. The caller does not want his or her parents notified. Sometimes, instead of the "grandchild" making the phone call, the criminal pretends to be an arresting police officer, a lawyer, a doctor at a hospital, or some other person.

The FBI has also received complaints about the phony grandchild talking first and then handing the phone over to an accomplice to further spin the fake tale. Their are also reports also reports of military families being victimized. After perusing a soldier's social networking site, a con artist will contact the soldier's grandparents, sometimes claiming that a problem came up during military leave that requires money to address. While the con is commonly called the "grandparent scam," criminals may also claim to be a family friend, a niece or nephew, or another family member.

Financial losses in these cases can be substantial and usually cost the victim several thousand dollars. Those amounts do not meet the FBI's financial thresholds for opening an investigation, however victims can seek assistance from their local authorities or state consumer protection agency.

If you find yourself in a situation where someone is contacting you for money, the FBI advises you resist the pressure to act quickly and try to contact the grandchild or another family member to determine whether or not the call is legitimate. And, never wire money based on a request made over the phone or in an email. Wiring money is like giving cash, once you send it, you cannot get it back.

End Of Story

Jack Swint-Publisher
West Virginia News
E-Mail:  WestVirginiaNews@gmail.com
Website: http://WVNewsOnline.com
Blog: http://WestVirginiaNews.blogspot.com
Twitter:  @WVNewsOnline
LinkedIn: Jack Swint
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