What Is the Anti-Deposit Fraud System?

As if moving house isn’t fraught enough with stress and anxiety, now house buyers and sellers alike need to also consider the worrying increase in deposit fraud. This can occur when the deposit paid for a house is intercepted by criminals and stolen en route from the buyer to the solicitor. It can also happen when house buyers are sent incorrect bank details from a fraudster posing as the law firm, so that the buyer sends their deposit to a criminal’s bank account.

The Fraud

A report from the Financial Conduct Authority found that £350 million was lost in 2018 when funds intended for house deposits were paid into fraudulent accounts. Most of this money was lost when criminals sent fraudulent communications to a house buyer with details of their own bank account. This isn’t a small, petty or victimless crime: it can cause major heartache and can see house buyers’ hard-earned money or even life savings disappear before their very eyes. There are even some cases where it’s not just the deposit that is stolen but the entire house purchase amount.

The Solution

A new anti-deposit fraud scheme has been set up by LMS, a company which holds a database of many law firm’s bank accounts. LMS has set up the handy Bank Account Check Service. This allows house buyers to check that the bank details they have been given for their conveyancer are correct. The other solution is to ring your conveyancer and check any bank details over the phone. You can also request that they do not send you bank details via email – that way you know that any communication you receive with such content is fraudulent.

Getting the Right Conveyancer

The other solution is to appoint a conveyancer with a proven track record for tackling potential deposit fraud as well as a robust and positively reviewed conveyancing process. Conveyancers who are accredited with the CQS (Conveyancing Quality Scheme) badge such as https://www.samconveyancing.co.uk/login have the highest standards.

Don’t fall prey to this increasingly common crime. As well as making use of this new anti-fraud scheme, there are steps you can take yourself. If you are emailed bank details, ring up your conveyancer to check these bank details over the phone, and never ever put your own bank details in an email.