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Phishing schemes: Don’t get caught on the line

by Mike Trittipo

Once upon a time, some people using the Internet would warn others “Don’t open any e-mail message that says ‘X’” or “Don’t believe the offer that says it’s from company ‘A’ to get free product ‘B’” or “The airline ticket offer going around is bogus.”  It was never good advice. 

Not that the messages they were trying to describe weren’t fraudulent.  They were.  But trying to pin the advice to a specific company name, or specific words in a subject line, was always short-sighted, focused on the wrong things, using an inadequate heuristic.  It was like telling a child not to trust a stranger who offers them a Mars® candy bar, as though a stranger offering an Almond Joy® candy bar or M&M®s or a toy would be OK.

Successful fraudsters tend to be inventive.  Any question about some possible inconsistency in what the mark thinks he’s heard is quickly patched over with some new explanation.  When no one trusts Nigerian princes anymore, the story comes from a Togo general.  When that fails, it comes from a corrupt official or a master sergeant from the Iraq war with access to valuable art or gold, or someone with Mexican drug money or a container in a shipyard in San Francisco sent by Chinese criminals whom a timely snitch has sent to jail, but who didn’t tell anyone where their valuable cargo was.

Likewise, it would be ridiculous to warn people not to trust anyone offering investments who is named Ponzi (even if he were still alive).  There have been untold numbers of “Ponzi” schemes run by people with other names – including recent ones in Minnesota that took in many otherwise seemingly sophisticated investors.  Whether the schemes involved stock, or other securities, or real estate, or oil wells, or consumer electronics inventories has never been the issue.  One needn’t be on guard against certain purported investments or vehicles any more than one should be on guard against certain names.  The name of the crook or the object of the transaction is never, never what to look out for.  The potential details are too varied, the potential “facts” too multifarious.  What to look out for is the pattern. 

So if you’re a lawyer who doesn’t want to be caught in a phishing scheme, in which you’ll end up writing a check out of your trust account for more than has really (irreversibly) been deposited into it, what do you watch out for?  Divorce cases with property settlements amicably agreed to by the spouses and just needing a lawyer to finalize?  Collection matters where the alleged debtor, upon being presented a final pre-suit demand or being sued, will agree almost immediately to pay the perhaps-“forgotten” bill, or agree to pay because of “fortunate” timing on some income?  How about being solicited to negotiate and draft the final terms for a large equipment sale, where the parties have already tentatively agreed to about a third down via a certified check, out of which you can take your fee (or retainer)?

An MSBA member recently was asked to be the seller’s lawyer in a deal like the last mentioned.  The company named as seller exists, at the address given for it.  The company named as buyer exists, at the address given for it.  Individuals of the names on the “letter of intent” exist at both companies, and have LinkedIn and Facebook profiles linked to the companies.  Each company’s existence for a long time is attested by a variety of records.  The type of equipment was appropriate: precisely what the supposedly selling company makes, and what the supposedly buying company could use.  And the solicitation didn’t come through a “random” e-mail; it came through a “FirmSite” on Thomson-Reuters’s “FindLaw.”  The name given for the contact person for the seller is the name of a real manager at the company, verifiable on LinkedIn and elsewhere. 

There was only one problem: communications to the named seller and buyer through “neutrally established” channels showed that neither of them knew of the purported deal.  The fraudsters had counted on communication being either through the FirmSite web-based mechanism, or through a Gmail account using the “selling” company’s name. 

So what should tip a lawyer off, apart from the “too good to be true” part?  Several points.  First, the “too good to be true” part is a big one itself.  How many million-dollar deals do you think end up being given to lawyers found through a referral site?  Second, the suggestion of using a certified check up front, to immediately get you, the lawyer, some money in your trust account.  Anytime a client wants you to hold a lot of money quickly, your antennae should go up. 

In fact, and this can be a third point, any rush, haste, or attempt to create a sense of emergency at any point should raise your suspicions to “orange” right away.  This is worth mentioning, because sometimes you can get out “in time” just by sticking to clear rules about when – exactly! – you free up funds from your trust account.  Bottom line: it’s NOT when your bank says they’re available.  You really did have to be paying attention during that U.C.C. class dealing with forged instruments and the various reasons and deadlines for dishonor.

Fourth, the English.  No doubt, most lawyers’ ACT/SAT/GRE scores for English were better than most English majors’.  So we run a risk of being judgmental.  But seriously, take a look at the text reproduced below.

My company have been negotiating the sale of an Equipment to a buyer in your state and have made some progress in price agreement which is about $1.650,000. At this point we need an attorney that would draft a purchase and sales agreement for the transaction. Are you able to take this matter? Please let me know so I can send you more details.If not, a referral will be appreciated.

“My company have”?  Seriously?  OK, granted, some Brits will say “the team were” instead of “the team is.”  But subject and verb should agree in number.  “The sale of an Equipment”?  Puhleeeze.  Quite apart from the random capitalization, no one you want for a client (or who has a million dollars) would say “an equipment.”  We’ll leave aside the half-European, half-American treatment of commas and periods as separators at the thousands and millions points.  We’ll ignore the “an attorney that” instead of “attorney who.”  And maybe – maybe – the lack of a space in “details.If’ is just a type.  Maybe.  Maybe it’s all just because the writer is supposedly from the Netherlands. 

It gets worse.  Our astute Minnesotan lawyer wrote back with some questions.  For example, what is the equipment?  What’s been agreed to so far?  The response includes two attachments, one a “confidential letter of intent” and one a description of the “an Equipment.”  They both happen to be more or less plausible, although they have some tell-tales.  But here’s the text of the e-mail sending them. 

Thanks for your prompt response to my inquiry My company VEKA GROUP NV, is a Europe based Marine Construction firm

We currently have a buyer for one of our Equipment  '"18-inch Cutter Suction Dredger (CSD)". The buyer is Mini-Dredge Inc 1006 6th Avenue Se East Grand Forks, MN 56721

We have negotiated the Letter of intent sent by the buyer 'Mini-Dredge Inc.' both company has agreed to the content of the letter of intent.Base on this,we will like to engage your  firm as our company attorney,   in this transaction .to help draft the Purchase and Sales Agreement and provide other service as requested by the buyer in the Letter of intent.

I have attached,the  Letter of intent sent by the buyer  for your review.

Where to begin?  If you can’t find at least twenty faults in the English grammar, punctuation, and typography, you aren’t trying. 

In fact, the number of errors and their type strongly suggests a Chinese fraudster, not a Slavic or Middle Eastern one.  There are several instances where singular and plural are not distinguished, and several instances where the subject and verb do not agree in number.  (“both company has agreed?)  Moreover, there are several places where punctuation is missing, with a run-on effect; while at the same time there are several places where a space is missing after a period or a comma: something that happens frequently when Chinese try to write English.  The total insensitivity to capitalization also suggests Chinese; all European languages have capitalization rules.  We needn’t even begin with “Base on this” instead of “Based on this,” or the weird “Se” abbreviation for “South East” instead of “SE,” or the “one of our Equipment,” or the odd unpaired quotation marks or inconsistent mixing of single and double marks, and so on.  Hey, they’re foreigners, and we don’t want to be judgmental, and they’re about to give me a big percent of a million and a half, right?  Wrong.

What about the attachments?  They say the equipment is located in Louisiana.  So why a Minnesota lawyer?  In fact, the letter of intent says that the “vendor” is the “Current owner of the equipment represented by Dredge broker: Mr. Louie Jackson.”  So why would the “seller’ be a Netherlands shipyard?  Why would any two rational parties, with the buyer being (supposedly) North Dakotan, make a letter of intent saying that the “Seller [is] to provide a lawyer who can draft a purchase agreement in regulation with the state laws of the buyer”?  (Do you remember the earlier reference to wanting a lawyer in the buyer’s state?)  Why would that be a Minnesotan lawyer, again?  The attachments are full of other clues, that needn’t be repeated here or dwelt upon.

At this point, we’re outside the realm of English, strictly, and into the realm of common sense.  And that may be the place to end this warning.  Please, use your common sense.  Just because a company X really exists with an employee named Y doesn’t mean that the person who writes to you claiming to be Y really is so.  Be very wary of any appeals to greed, urgency, and the like.  Ask lots of questions about any inconsistency.  Above all, do not, ever, disburse any funds from your trust account based merely upon your bank having said that some deposit is “available” now.  Your inquiries have to take into account all possible U.C.C. forged instrument scenarios and their timelines for dishonor or revocation. 

Early in this article, mention was made of looking out for patterns, not specific names. You will find a good list of suggestions what to look for at http://practicepro.ca/practice/fraud.asp  We strongly suggest you visit and consider their tips about the patterns to look for.