Paul Robertson, Managing Director of Midway Insurance and 1st Sure Flats tells of his recent experience.
Probably the last thing that has been on my mind is cyber crime. After all I write this month from my brother in laws beach house on the end of a sleepy island. Most residents here don’t understand why the island has a policeman. Certainly the current one hasn’t made an arrest since he was assigned here three years ago. No one locks their doors and even if they decided to they may not have seen the keys for twenty years. If you were to leave your wallet on one of three bars of the island you would be guaranteed to find it untouched the next day.
So in this serene paradise how could I now be worried about the theft of my money? The answer is a sophisticated attempt to obtain money by deception which I share to promote awareness of the increase in these clever scams.
A few days ago my finance director who happens to be my sister Carole received an email from me asking if she could transfer some money for me. Actually the email was not from me but whoever wrote it had clearly intercepted one of my emails. It had my signature complete with all the company footer information and looked totally genuine. They obviously had done some homework.
Carole replied asking what was the problem and what did I need suggesting I called her. The scammer replied plausibly and sent some bank account details. After all I was on holiday and could have easily lost my wallet and needed to pay the hotel bill. The only two problems were that Carole obviously knew I was staying at my brother in laws and there was no way if I had of been in a hotel that the bill was £19,234.56.
The reality is that this is an ever emerging threat and service charge funds are an obvious target. With scammers becoming more sophisticated and our over dependency on emails and electronic transfers it is not hard to see how managing agents could be targeted. An intercepted email for payment from a genuine supplier could easily be used as a base for a successful scam. The right email at the right time could easily lead to a payment to the scammers account.
So you may ask, what can we do to protect ourselves?
There are two easy answers. Firstly only make payments to accounts that you hold on record and have been checked and verified. Make sure you call the supplier on a number you can trust and not the one on the demand when making the check. Your last line of defence is insurance.
Most prudent managing agents recognise the need for directors and officers (D & O) cover for their clients but I would argue that D & O alone is no longer enough. That’s why our Elements product goes far further. As well as offering D & O it also includes company liability, legal expenses including tribunal defence along with cyber cover and theft of money by deception, either electronic or telephone based fraud. In other words all the essential elements of protection needed by RMC’s.
Whilst my scammer obviously did a bit of research on me I am glad to report that the Metropolitan Police are now doing a far more thorough investigation on the scammers bank account. If you find yourself on the receiving end of a scam and you get given bank account details then always report them to the Police as this is where they can be really effective in tackling these crimes. You will find information on their website at www.met.police.uk/fraudalert along with some excellent advice in the form of free downloadable material such as the Little Book of Big Scams.
And in case you are wondering; no I didn’t report this to the islands policeman. Not only did I not want to ruin his day but also I didn’t want to ruin the islands record of no crime by reporting a crime that happened somewhere in cyber space.
Paul Robertson is MD of Midway Insurance and 1st Sure Flats – www.1stsureflats.com Tel: 0345 370 2842.
