10 Ways To Protect Yourself From ‘Friday Afternoon Fraud’

 

 A new form of cyber attack is on the rise. Fraudsters target the conveyancing solicitors of those in the process of buying a house, infiltrating the company’s email and diverting the funds of the buyer. reallymoving has 10 top tips to avoid losing it all.

 This so called ‘Friday Afternoon Fraud’ (named as hackers take advantage of a busy working day, where transactions can be hurried through before the weekend) can have a huge impact on buyers, with some victims losing their savings, and the property they intended to buy.
The Howard Mollett case this year was particularly painful, where the victim, in attempting to buy his first home, lost £67,000 when scammers used his solicitor’s email address to convince him to send the money to alternate bank accounts. He is still trying to retrieve this money, and no one can decide who is to blame. 

On one hand, legal firms have an obligation to highlight the risks, with 3 in 10 UK law firms being subject to cyber attacks in the last year. However, in research undertaken by tm group, 58% of firms felt not particularly threatened, or not threatened at all. Whilst understanding protection from cyber crime was important, only 13% strongly agreed that they had spent a high proportion of resources securing their communications.

So, whilst the legal profession focuses on considering the safety of their processes, there are things you can do to protect yourself, your property, and your money.

1.    Money and the human approach

If you’re making a bank transaction, or money is changing hands, call your lawyer, using the number you’ve always used for them. Don’t email bank details, and do not automatically transfer money to a bank account given in an email. If your lawyer emails you with bank details, call them and confirm. When you’ve made the transaction, call them again. We get used to needing a paper trail, but when large sums of money are involved, it’s better to talk directly. If the number in the email is not your usual solicitor’s number, or you get forwarded to an automated system, do not call it. Get in touch with your solicitor using the number you’ve used previously, and check whether they meant to send that email.

2.    Don’t underestimate a hacker

As victim Howard Mollett said, “This is not someone claiming to be the cousin of the President of Nigeria asking me to wire money to them.” This was not even a similar email address that had one letter different to his solicitor’s. It was his solicitor’s email address. The hacker replied to previous threads, commenting on recent Mollett’s work trips, making it look genuine. 
Everything you know about hacking – recognising dodgy misspelt emails, or fake companies – does not quite hit the level here. These hackers are more than competent – they have found a way to impersonate the person you trust with your money. 

3.    Stay wary, even if expecting an email

Don’t lower your guard because you have been expecting an email requesting the money – that’s how the hackers make it easy. You’re not being asked for money from nowhere, you are anticipating paying this money, and so it’s not at all strange that you’re being asked for it. Even if you’re waiting to give your payment, call your solicitors when an email arrives. Check that the numbers, email and other details match, but ask them to confirm the email, the bank details and the amount. It is too easy to expect to pay, and to be eager to get on with the process. Do not jump in without double checking every time you pay an amount.

4.    A change of bank account should set off alarm bells

If your legal firm says that they want you to use a different account to one previously used, or a different account because you’re abroad, or the amount is different – question it, and call them directly. Changes in banking are not the norm, and if issued by email, should be checked carefully. 

5.    Know when you’re at risk

You are more likely to be the victim of fraud if you have previously had your identity stolen, along with not having a mortgage, or if you’re living overseas. You can also be more at risk if going through a break up or in the middle of a family dispute, as you are more likely to be distracted and rushed when attempting to finalise a deal. Be extra vigilant and pay attention to your accounts.

6.    Register your property

If your property is not registered, you are more at risk. Check with the Land Registry, ensuring your contact details are correct. You can also sign up for alerts if anyone tries to change your property details, for example, attempting to get a mortgage using your property. You can also pay £40 to stop the Land Registry from registering any sale that is not registered under your name and confirmed by a solicitor.

7.    Don’t leave your property empty

Whether you’re a landlord, own a holiday home, or have inherited an empty property, don’t leave it empty. Be vigilant about registering it, and either visit it, or get someone to keep an eye on the place and collect the post. Having an empty property puts you at a higher risk.

8.    Pick a solicitor who understands the risks and has a plan

This is a hot topic right now, and some firms are responding by using technology to assess conveyancers on the other side of the transaction. When you’re transferring large amounts of money, you want to be sure that not only your solicitors are taking the right precautions, but the other side are as well. Talk to your solicitor about what they do to avoid ‘Friday afternoon fraud’ and ask any questions you need to.

9.    Checking the account first

Another way to be completely sure, if you’re particularly concerned, is to send a small ‘tester’ sum to the account, and then call to check it has been received. If your solicitor can confirm arrival of the money, then you can send the rest. 

10.    Ensure you’re well protected

Whilst it is definitely down to your lawyer to ensure their systems are secure, you also need to make sure yours are too. That means using very secure passwords, which are not used for anything else, and are changed regularly, as well as keeping anti-virus software up to date, and avoiding using insecure servers to make payments. 


Whilst this list should ensure your money arrives to the right people safely, ensuring you have done everything you can to make sure the transaction is secure will be important if anything does go wrong.
Everyone thinks this will never happen to them, or that they are well versed in recognising fake emails, but as the money you put towards your new home is likely to be most of your savings, it is better to be safe than sorry. Always talk to people directly, don’t wait days to see what has happened to the money, and be more wary than you feel necessary. Once the money is gone, it is difficult, if not impossible, to get any of it back. 

Neighbourly disputes – what you need to tell buyers

 

Neighbours, everybody needs good neighbours. Sadly, that isn’t always the case. 

And when it comes to selling your home it is your duty to inform would-be buyers of any neighbourly disputes that have involved official bodies. If you don’t, you leave yourself open to being sued years down the line. 

The guidelines on what you have to declare to prospective property buyers are a little bit murky,  but we will do our best to shine a light on what you should and shouldn’t be doing.

There have been examples in the past where buyers of a home have sued the previous owners for not warning them about especially awful neighbours. 

With this in mind, it’s wise to be aware of the law and what your obligations are. 

Firstly, if you have been unfortunate enough to have had an actual dispute with a problem neighbour, you will have to make reference to this on the form your solicitor sends you – known as a Seller’s Property Information Form (SPIF). 

It is left open to interpretation as to what counts as a dispute and what doesn’t. However, generally speaking, if you’ve contacted your neighbour in writing, or made a complaint to the council or another authority regarding their conduct, you will have to declare this.

The most common types of disputes that would need to be declared on the SPIF are anything that involves shared house maintenance (this is usually to do with repairs to shared facilities like drains or gutters) or boundary disputes (disputes involving land or fence/hedges).

It’s also important to remember that action can be taken by buyers for years after the sale of your property has gone through. 

So, even once you’ve moved out, the problem could come back to bite you if you’re not upfront and honest with buyers from the start.

On the other side of the coin, there are issues that you needn’t mention. For instance, you might have a neighbour who was once a regular holder of noisy, raucous parties, but this is now no longer a problem. 

In this case your buyer would not need to be informed. Similarly, if an issue has been dealt with amicably between you and your neighbour, there is no need to mention this to prospective buyers. 

Other issues such as noise, children and pets tend to be very subjective – so, just because you’ve been driven crazy by the neighbour’s dog barking, doesn’t mean your buyers (who may have pets themselves) will think the same. In other words, you are under no obligation to inform would-be buyers of things like this. 

It’s best to check with your solicitor or estate agent if you are unsure about any of this, what constitutes a dispute and what, if anything, you need to declare. 

The SPIF is a legal part of the contract between you and your buyer, so it’s important to get this right to prevent any issues occurring at a later date. 

Neighbourly disputes, when they do occur, can be very colourful and newsworthy – as we saw with Channel 4’s Posh Neighbours at War, which was screened on Monday 3rd May.  

Many people will have heard of the story of the wonderfully named Zipporah Lisle-Mainwaring, the eccentric property developer who painted her plush Kensington home in red and white stripes just to irritate her neighbours that objected to her planning applications.

The dispute with her neighbours, who have labelled the property as an eyesore, has gone back and forth to the high court and magistrates’ court several times with still no end in sight.

Super-rich neighbours are also increasingly at war over new basements being dug, as well as things such as noisy-leaf blowing and even an opera festival being staged! 

The likelihood of disputes with neighbours remains very low, and it’s very unlikely that you’ll be taking anyone to court over a stripy coloured home, but if any issues do arise it’s vital that you go through the proper channels and declare it to the buyers of your property. 

It could cost you must more in the long-term if you don’t.

Up and up and up – why are asking prices continuing to rise and what does this mean for buyers and sellers?

 

Despite the cost-of-living crisis, political uncertainty and various other factors at play, asking prices for UK properties continue to rise – and rise at astronomical rates.

 According to Rightmove, average asking prices for UK homes have soared by £55,000 since the beginning of the pandemic, with no slowdown as a result of the cost-of-living crisis that has gripped the nation.

The property website also revealed that asking prices increased by £7,400 (or 2.1%) between April and May, bringing the average to a new record high of £367,501.

What’s more, despite concerns about the health of the UK economy – with inflation at a 40-year high, interest rates increasing at a rapid rate and wage stagnation or declines in many industries – prices have grown by 10.1% in the past year alone. The property market is therefore bucking the trends seen elsewhere.

Rightmove have said that a fourth successive interest rate rise by the Bank of England (there’s now been a fifth since the research was released, as the Bank tries to keep inflation in check) has done little to reduce demand.

And it is this demand that explains why asking prices continue to rise even as people’s bank balances start to feel the pinch. Demand is continuing to massively outweigh supply, which means only one thing – an upwards pressure on house prices.

There are no signs that the supply-side issue is going to be fixed anytime soon, which could lead to asking prices rising higher still.

Rightmove’s findings help to paint the picture more vividly. It found that activity levels remain robust and substantially greater than before the pandemic. In fact, the portal said that the number of buyers is up nearly a third compared to 2019 levels.

Additionally, sales agreed have risen by 12% so far this year, in comparison to the same period in 2019, but are down 17% in the year to date compared to 2021, when the stamp duty holiday was still in force.

By contrast, the number of available properties for sale on the market is down 16% compared to last year and 55% compared to 2019. With the most acute shortages being for two and three-bedroomed semi-detached homes.

The ongoing disparity between supply and demand means it remains a sellers’ market for many, with those looking to sell their homes remaining in a strong negotiating position.

Will it last?

Tim Bannister, director of property at Rightmove, believes that rising living costs and interest rates will begin to negatively impact prices later this year.

He said: “People may be wondering why the housing market is seemingly running in the opposite direction to the wider economy at the moment. What the data is showing us right now is that those who have the ability to do so are prioritising their home and moving, and the imbalance between supply and demand is supporting rising prices.”

He added: “Though demand is softening from the heady levels we saw this time last year, the number of buyers enquiring is still significantly higher than during the last ‘normal’ market of 2019, while the number of homes for them to choose from remains more constrained.”

While both high demand and constrained supply remain in place, there is unlikely to be any major drop in asking prices.

However, there are signs that buyer demand will start to diminish, with Rightmove pointing out in its research that average monthly mortgage payments in May increased to overtake average monthly rent payments.

The research found that the average monthly mortgage payment for a typical First Time Buyer has gone up by 13% (£100) since December 2021, following successive interest rate rises. That said, this is only 11% (£87) higher than ten years ago.

What happens next?

The future is largely reliant on how buyers and sellers react to the cost-of-living crisis, which is going to remain with us for some time. The current domestic and global political uncertainty could also start to have an impact. Although, so far, the property market has batted away Covid-19 and the cost-of-living crisis much more easily than it did Brexit deadlock and the global financial crisis.

The fundamentals of the market remain sound, which makes any sudden falls in prices unlikely. Buyers may still be keen to buy before interest rates go up again, and while decent mortgage deals remain on the market. If they are First Time Buyers, they may feel that trying to get on the property ladder is a better way of shielding themselves against the rising cost of living than renting.

Sellers, meanwhile, continue to find themselves in an enviable position for the moment, but may be wary of the long-term impact of the cost-of-living crisis and may be eager to sell now before the market takes a turn for the worse.

There have already been some murmurings of a slowdown in the market, which could convince wavering sellers to act now.

Problems remain with the number of transactions that fall through each year, and the time it takes to get a sale completed, which could continue to put some sellers off.

While ever-increasing asking prices might seem like fantastic news for sellers, for a smooth and well-functioning property market, it’s not really sustainable. There is also always a danger that the bubble bursts, like it did in 2007-8, and issues like negative equity start to rear their head again.

For the moment, that seems highly unlikely, and the greater likelihood is that average asking prices will continue to go up month on month for the foreseeable future.