Number of bogus law firms doubles in three years
Bogus law firms are sprouting up at an alarming rate with 700 a year springing up.
According to the Solicitors Regulation Authority the number of reports they receive has more than doubled since 2012 with almost half of these involving criminals copying the identity of an existing law firm. Bogus law firms can directly target the public or genuine law firms for money or information.
The SRA’s Risk Outlook also says a quarter of firms have also been targeted by cyber criminals, with nearly one in ten attacks resulting in money being stolen. The regulatory body says that firms must understand that protecting themselves is as much about people and training, as it is technology and that most cybercrime involves trickery like fake emails or phone calls to access information such as passwords.
The report highlights one of the newest of these tricks, CEO fraud, where senior law firm figures are impersonated and staff, such as people in the accounts team, are ordered, often by email, to transfer money to pay an invoice. Such scams often take place on a Friday, so as to give the criminals more time to avoid detection.
Also for the first time, the SRA is showcasing access to legal services as a key risk. Research shows that only a third of people with a legal problem seek professional advice. And only one in ten will take advice from a solicitor or barrister
Paul Philip, SRA Chief Executive said: “Many of the risks we are highlighting will be familiar to those in the legal sector. However, this does not make them old news – the challenges around areas such as cybercrime are changing rapidly and require constant vigilance. Well informed staff and good processes are just as important as antivirus systems in staying cyber secure.
“We want to see firms proactively making sure their clients are also aware of the risks in this area. For instance, we would recommend that people avoid sharing bank details over email, or transferring money before confirming the source of any request.
“We also know there are far too many people who either cannot afford, or choose not, to access legal services, with 63 percent saying they do not think legal advice is affordable. We are reforming the way we regulate to free up solicitors, and open up the market to healthy competition. We want providers to respond by playing their part in creating new, more affordable services that respond to the needs of the public and small businesses.”