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Homebuyer deposit scam: what to look out for

Published 23 January 2016 by

If you’re looking to buy a home, it’s probably one of the biggest purchases that you’ll make in your lifetime, so it’s only natural that you want everything to be perfect. Unfortunately, a new scam from fraudsters threatens the deposit that you need to complete the sale, which could put the whole house buying process in jeopardy. To make sure you know what to look out for when it comes to this homebuyer deposit scam, we’re going to walk you through the basics.

The scam

Homebuyers are being targeted by fraudsters in a new scam which seeks to raid them of their deposit. One newlywed couple spoke to the Daily Mail about their recent experience of the scam.

The couple were in the process of putting down a deposit for a £269,000 property in Hertfordshire when fraudsters targeted them with this con. As is usual when you’re buying a property, the couple were emailing back and forth with their conveyancing firm Advantage Property Lawyers about paying the deposit for the property. In December, they received an email from the firm confirming this.

A few days later another email was received – supposedly from the firm – saying that their usual bank account was being audited, with the account number and sort code for an alternative account being provided. In fact, this email was from a fraudster who had hacked into either the solicitors’ email account or the buyers’ email account, and was posing as the solicitor after viewing the correspondence between the two.

The couple transferred the money over swiftly and only realised that something was wrong when they got in touch with a solicitor from the firm directly, who told them that the cash had not arrived and that the email had not been sent by them.

After contacting their bank, the couple managed to get back a total of £22,000 of their £45,000 deposit. The rest of the cash was unable to be retrieved as it had already been withdrawn by the fraudsters. Although this is just one couple’s story, The City of London police state that the average loss for reported incidents for this crime is £112,310, according to stats from between 2013 and 2015.

Protect yourself

To help make sure you do everything you can to protect your deposit when looking to buy a house, follow these tips:

• Remember that solicitors will rarely give out their banking details via email. It’s also unlikely that they’ll change their bank account details and notify you of this by email, so be wary of any correspondence that you receive claiming this.

• If you’re unsure that an email you receive from your solicitors is genuine, ring them on a number you’ve used before and know is real.

• If after you receive an email like this, you are called by someone claiming to be from the solicitors, call them back on a direct number and on another phone, if possible. This will help to ensure you’re not speaking to a fraudster who could have got your details from hacking into your email account.

• Never transfer all of the money requested at once. Test out the waters by transferring a small amount first such as £1 and then call the solicitors to see whether they received it.

• Protect yourself against hacking by installing up-to-date antivirus software onto your computer and make sure that you use secure passwords that you update frequently.

• If you think you’ve fallen victim to a scam like this, get in contact with your bank immediately. The quicker you do this, the more hope there is of retrieving the money.