We have received the following email from our professional body which will be of interest.

“The Financial Services Industry continues to evolve following the demands placed on us by our customers and Independent Financial Advisers. Financial Crime and in particular, fraudulent schemes also continue to evolve at an alarming rate.

Over the past few months, UK and Europe Financial Crime teams have been assisting a number of Independent Financial Adviser firms and their clients as a result of them becoming victims of fraud. Serious and organised gangs are using a new ‘modus operandi’ and during the past weeks another four IFA firms and a number of their respective clients have been targeted.

On every occasion, customers email accounts have been hacked. Once hacked, the ‘criminals’ identify those financial services firms with whom the customer has a relationship with and then attempts to encash their victims products. 

Communication between the fraudster and the IFA is always done via email and originates from the customers genuine email account. Instructions to change bank account details are then submitted to the IFA (sometimes including a copy false bank statement) who in turn, pass the instruction to the provider. Once the details have been updated the fraudster subsequently instructs the IFA to encash or withdraw funds from the product being targeted and have the proceeds credited to the new bank account. Once the funds have been deposited, the money is immediately withdrawn and very difficult to recover.

In respect of the cases identified to date, there are a number similarities in that;

• The language used by the fraudsters is broken English and the emails contain a number of basic grammar and spelling mistakes;
• Requests to encash or withdraw money is always urgent and the instruction asks for the money to be transferred via Telegraphic Transfer or CHAPS.

The purpose of this communication is to raise awareness to all staff. We all have a responsibility to protect our customers assets and assist financial advisers anyway we can by ensuring any requests received are indeed genuine.

Should IFA’s receive such suspicious requests via email, then I would recommend they pick up the phone and clarify and confirm the instructions they have received with the customer verbally.”