The security and protection of clients’ funds has always been and will continue to be absolutely paramount to everything we do.
With this in mind, recent changes to working practices including a reduction in face-to-face meetings, more reliance on impersonal communication and copy or scanned documents have increased the risk that fraudsters and other criminals will attempt to exploit this to their advantage.
Our recommended administrators (Transact/Wealthtime/AJ Bell) have seen an increase since lock down in cases where fraudsters, pretending to be their client, have duped advisers into sending instructions to change the client bank account details they hold and then attempt to make significant withdrawal payments to the new account that is under the control of the fraudsters.
The common theme in all of these attempted frauds is that the adviser has relied solely on communicating with their client via unencrypted public email, which the fraudsters have taken over by compromising the client’s email account. These frauds are very sophisticated and can be many months in preparation with the fraudsters using the personal information they can obtain from a compromised email account or access to the client’s personal files on their computer to make their requests appear extremely plausible.
Documentation has also been provided in support of the fraud attempts being forged to such a high standard as to make it practically impossible to verify its authenticity by visual means alone.
Security and protection measures
Thankfully, to date, we are not aware of any instances where fraud has been successfully perpetrated and a significant loss has occurred for our clients.
However, we believe it would be entirely prudent and sensible to increase the checks and measures we currently employ to further reduce any possibility of a fraud or loss occurring.
Henceforth, if a withdrawal or transfer of funds is requested or instructed, we will make additional checks before processing anything. If you call us to make a withdrawal, we may ask you some additional questions when you call to verify your identity, we will also send an email (for those with a known email account) and ask you to reply to confirm the instruction. Alternatively, if you email us to request a withdrawal, we will call you to confirm the details and again we may ask additional security questions to ensure that the request is legitimate.
We appreciate this may necessitate a little more effort and work, and could also impact a time critical payment, but once money is paid to a fraudulent account it is almost never recoverable. If a fraud is successfully perpetrated, we are all victims as the costs of investigating and correcting the shortfall can be significant for advisers and result in significant worry and distress for the client.
Rest assured, our actions and any changes are solely designed to increase the safety and security of your funds.
If you do have any concerns about your financial investments then please do not hesitate to get in touch with us.