Almost six in ten property law firms say that cyber crime poses a big threat when handling property transactions – but only a minority have done much about it.
A total of 58% ‘strongly agree’ that cyber security is a concern at their own organisation, but just 13% have spent much time and money making their communications safer.
The ‘Friday afternoon’ fraud in which people moving house are tricked into transferring their deposit to the bank accounts of fraudsters, has become one of the most significant of all cyber crimes.
One buyer, Howard Mollett, had £67,000 stolen after cyber criminals intercepted emails between him and his conveyancing solicitor.
Mollett claims that his solicitor had not warned him about the risk.
In January, the High Court ruled that law firm Mishcon de Reya should hand over more than £1m after a client was conned into ‘buying’ a property from a tenant pretending to be the owner.
Mishcon de Reya, which was not found to have been negligent or irresponsible, has been granted leave to appeal.
Key findings in a new report based on research by TM Group, calls for law firms to do more to educate their clients on the possibility of cyber crime – for example, by providing free literature on how to spot genuine communications.
Next May, new EU General Data Protection Rules will considerably increase law firms’ obligations to maintain the cyber security of client data.
However, judging by remarks this week made by RBS chief executive Ross McEwan, victims of fraud should shoulder some of the blame. He labelled them “careless” and warned that they should not expect compensation from banks.
According to research for software firm Aspect, only 44% of all cyber crime cases where monies were lost fraudulently were refunded by banks, taking on average 3.7 days to reach their accounts.
EYE would be very interested to know if agents specifically warn buyers and also sellers who are moving of the possibility of cyber crime, particularly the Friday afternoon scam, and if you do, what advice you give.
The report, ‘Protect and Survive: Risk and Cyber Security in the Property Sector’, can be found at http://web.tmgroup.co.uk/cn/an9um/survive