The Law Society of Scotland has reported that Scottish law firms have recently been targeted by a redemption statement scam when acting in sale or remortgage transactions.

When a solicitor requests a redemption statement from a lender, the lender in many instances sends that redemption statement to the firm by way of fax transmission. A number of solicitors have reported that, on some of the fax statements, bank account details where the redemption monies are to be remitted have been substituted with falsified bank account details.

It would appear that the redemption statements have been intercepted between the lender and the solicitor and are then sent on to the solicitor with fake bank account details. The fake redemption statements appear to be genuine. They disclose the correct client name, address and account number. Similarly the amount due as shown on the statement has been the amount that the clients would have expected to pay to redeem the loan in full.  So far, it is understood, that Halifax and also Nationwide Building Society statements have been affected.

The advice from the Society is that those receiving redemption statements should carefully scrutinise the statements and check that the redemption bank details provided are genuine. So far the redemption statements affected have been by way of fax transmissions received by email. However solicitors are being urged to be vigilant to all redemption communications whether they are by traditional fax or email and ensure that all colleagues are made aware of this threat to prevent your firm becoming a victim to this type of fraud.

The Society is also recommending that firms check recently settled transactions to ensure that monies have been transferred to the lender’s nominated account.

Further information can be found on the Law Society of Scotland website