PSR Report Highlights Growing Risk Of APP Scams

APP scams can be easy to fall for.

PSR Report Highlights Growing Risk Of APP Scams

APP scams can be easy to fall for.

Given that the focus of the report published by the Payments Systems Regulator (PSR) was on steps to improve understanding of the scams and measures to enhance consumer protection, it’s clear that the Regulator acknowledges how convincing these scams can be.

As a result of this, it’s now considering the introduction of compensation for consumers who fall victim to these scams and who end up losing tens of thousands of pounds in the process.

APP or authorised push payment scams occur when a consumer authorises funds to be transferred to someone that they believe is the legitimate recipient. Instead, however, they are actually transferring money to a fraudster.

A case involving this type of scam was highlighted by the BBC on 7th November.

In the process of buying a house, Ms Blakeley had received an email from her solicitor regarding bank details. On the day of completion, she followed the instructions provided and transferred the money to what she thought was her solicitor’s account.

However, as Ms Blakeley explained: “Within about three hours, we realised the money had gone missing.”

The funds had actually been sent to a criminal.

Whilst in this case the consumer was able to recuperate the lost funds, this is not guaranteed. Thousands of additional pounds were also lost in legal fees and the issue remains part of an ongoing dispute.

Cases like this reinforce the need to advise clients on the risk of scams, regardless of whether they’re already aware.

In order to minimise the risk of your client falling victim to a scam, ensure that you take the following steps:

– Establish bank account details in person

– Agree to correspond using a single means of communication

– If this changes, it must be confirmed in person

– Encourage your client to question correspondence, even if it’s taken place within the same email trail

The risk of fraud will, of course, apply in reverse. This is why it’s vital to establish who’s on the other side of the transaction before funds are transferred.

Lawyer Checker provides legal professionals with the tools to do this. To verify that the bank details of a third-party firm are genuine and mitigate the risk of fraud, the SRA advises considering the use of a service such as Lawyer Checker.

As well as protecting transactions to a consistently high level, the use of Lawyer Checker services can positively influence the culture within a firm and ensure that employees are alert to the risk.

At a time when new threats to client funds are emerging frequently, it’s vital that prevention strategies are implemented on a wide-scale basis. It is only then that their effectiveness will be ensured. Click here to find out how Lawyer Checker can protect your clients’ money.