Lloyds Bank has reported a worrying increase in conveyancing scams, with incidents rising by 29% last year.
These scams involve criminals hacking emails to intercept property deposit payments, causing victims to lose an average of £47,000, with some losses exceeding £250,000.
Approximately 45% of victims are aged 39 or under, making first-time buyers particularly vulnerable.
How conveyancing scams happen: Conveyancing scams typically start when either the solicitor or homebuyer has their email account hacked. Fraudsters monitor email exchanges related to property purchases and send false payment details at the opportune moment. They may use spoof email addresses that look very similar to genuine ones, making the emails extremely convincing. In some cases, fraudsters may even call the victim, impersonating someone from the solicitor’s office, to reinforce the urgency of making the payment. The homebuyer is then tricked into sending money to a bank account controlled by the criminals.
Liz Ziegler, fraud prevention director at Lloyds Bank, said: “Buying a new home is one of the most exciting moments many of us will ever experience. But it can also be incredibly stressful, given the amount of money involved, and the need to navigate a complex legal process.
“While the financial consequences of these scams are severe, the emotional toll can be even greater. The fraud often leads to the collapse of a property transaction, with a devastating long-term impact on those involved.
“Fraudsters prey on weaknesses in email security and exploit a conveyancing process that most people may only experience a handful of times in their lives.
“It’s vital that solicitors also grasp the importance of educating their clients on the risk of this type of scam and make a point of sharing payment details in person at the start of the homebuying process.”
Case study – Chloe’s story: Chloe, a first-time homebuyer in Birmingham, was excited to purchase a two-bed flat for £195,000. Throughout the process, she communicated with her solicitors primarily via email.
As the completion date approached, Chloe’s solicitor promised to send her the bank details for transferring the deposit. A few days later, she received an email that seemed to be from her solicitor, complete with an invoice and payment instructions. However, this turned out to be a cleverly crafted spoof email from a fake account.
The email instructed Chloe to make the payment to an accountant, rather than directly to the solicitors, and advised her to transfer the money in instalments. She was first asked to transfer £10 as a ‘test payment’, which she did. Another email, seemingly from her solicitor, confirmed receipt.
Chloe then attempted to pay the first instalment of £5,000 via her mobile banking app. Before completing the payment, her bank provided a warning through the app advising her to verify the payment details by calling her solicitor directly. Ignoring the warning, Chloe proceeded, assuming the details were accurate because she had made the test payment. She received another email confirming the payment and urging her to proceed with the next instalment.
However, when she tried to transfer another £5,000, her bank blocked the transaction and advised her to contact her solicitor. Chloe then discovered that her solicitor had not sent any payment details nor received any money. She had fallen victim to a scam, losing £5,000 of her deposit.
