Posted Nov 02, 2008 02:15 am CST
Incidents stretch from Atlanta to San Francisco, and though the facts may vary, the cases fit a pattern.
A lawyer receives an e-mailed solicitation from an overseas firm to work as a settlement agent in the speedy collection of a debt from another company. The debtor company sends a cashier’s check to the lawyer. The lawyer deposits the check into his trust account, subtracts his fee, then wires the settlement amount to the client’s account.
The trouble is the debtor company’s check is bogus.
Rich Kolko, an FBI special agent in Washington, D.C., says these lawyer scams—while new to the profession—are similar to those in which recipients get e-mails from fake websites that look very legitimate, down to using well-established financial institutions’ logos and trademarks.
Kolko says there are “very few lawyer cases” in this category.
One of those lawyers is Atlanta securities attorney Gregory Bartko, who is being sued in federal court for $200,000 by Wachovia Bank, which is seeking overdraft fees and reimbursement of money Wachovia wired to a Korean bank on Bartko’s instruction.
Bartko thought he was working on behalf of Taiwanese textile company Tah Tong, but he now believes the firm’s name was being used. He thinks the scammer is someone fraudulently representing himself “when he’s probably up in Canada. Tah Tong is a real company that we believe has nothing to do with this.”
Bartko also believes that neither Wachovia nor Sun Trust—the bank named on the cashier’s check—complied with proper clearing procedures. He argues that he should not have been able to wire the cash unless the check had cleared. “I was able to wire out even though the check had been dishonored,” he says. Officials at Sun Trust declined to comment for this article, and Wachovia didn’t respond to a request for comment.
But banks sometimes take risks with trusted customers. and lawyers have been trained to satisfy client wishes, including the desire to conclude matters expeditiously.
“There’s such a push to develop business, [lawyers are] actually particularly susceptible,” says Mike Downey, a partner at Hinshaw & Culbertson in St. Louis who advises law firms on risk management issues, particularly client intake. “In an economic downturn, lawyers are looking for things to do, and if you receive an e-mail and you can verify the information, you might think it’s not that unusual.”
To avoid being scammed, Downey recommends investigating potential clients, including asking how they found you, requesting common contacts and checking their Web presence to see whether it is more than a website. Beware of potential clients who want things done quickly, Downey says, and don’t take the job if you’re not willing to assume the risk.
Kolko goes further: “Don’t send the money to anyone; don’t send your personal information. If you don’t know who you’re talking to on the Internet, don’t do it.”