Stamp duty deadline sparks property deposit fraud fears
High Street banks are braced for a spike in so-called payment redirection fraud thanks to the stamp duty holiday.
Lender Santander said it had seen a 47% rise in this type of fraud in 2020, compared with the previous year, with £18m lost. Scammers persuade victims their account has been breached and to move funds to a supposedly safe account, which is actually controlled by criminals and emptied immediately.
With a flurry of home purchases expected ahead of the stamp duty holiday deadline, lenders are concerned thieves could try to intercept deposits as buyers rush to secure homes. Buyers have until June 30 to take advantage of the tax break after Chancellor Rishi Sunak extended the deadline. However, property purchases are expected to spike in the final days of March, ahead of the original stamp duty cut-off.
Buyers are advised to check payment details and contact their own solicitor, confirming a phone call with a fresh email or vice versa, or making sure to use a known phone number to reduce the chance of communicating with a criminal.
Susan Allen, of Santander, said: “Tackling fraud shouldn’t just be a priority for banks, but also for any organisation whose data could be breached and used by fraudsters to target their victims.”
The scam can work as follows: fraudsters intercept or impersonate an email from a solicitor, saying the firm has changed its bank account and telling the buyer to place their deposit – often tens or even hundreds of thousands of pounds – into a new account, which actually belongs to the scammers.
Richard Forrest, of Hayes Connor Solicitors, which specialises in cybercrime claims, said conveyancers should supply their bank details in their very first letter to a customer.
They should then either promise not to change it during the transaction or explain clearly how a change might be communicated – for instance in another letter with the firm’s letterhead, which is harder to forge.
“We have seen an increase in conveyancing complaints,” he added. “It’s a great target for fraudsters because of the amounts involved.”