Sophisticated scams abound
By Mark D. Killian, Managing Editor, and Gary Blankenship, Senior Editor
The e-mails are signed “Peggy Higashi.” But perhaps the more accurate signature would be “Peggy I-Gotcha.”
In September alone, “Higashi” — or more likely someone using the name “Peggy Higashi” — bilked Florida lawyers out of more than half a million dollars.
As reported in the October 1 News, a Sarasota firm was taken for more than a quarter of a million dollars when it deposited a bogus bank check sent by “Higashi’s” supposed ex-husband into its trust account and wired the money overseas before it was determined the check was fraudulent. The day that paper went to press, the News learned a Brandon lawyer fell victim to the same variation of the e-mail initiated scam.
Here’s how the “Peggy Higashi” scam works: “Higashi” e-mails seeking representation to help collect $648,450 owed by her ex-husband, “Landscott Higashi,” in a divorce settlement while she is on assignment in South Korea. If the lawyer bites, “Higashi” tells them her “ex” is ready to pay up and a cashier’s check for $289,500 drawn on Chase Manhattan soon arrives at the firm. The woman then tells the lawyers to take their fees and wire the rest to her. To help sell the scam, “Higashi” will provide those who correspond with her divorce documents and a copy of her passport. Because of the time difference between South Korea and Florida, all correspondence is via e-mail.
Since that October 1 story, the News has been contacted by a number of Florida lawyers wanting to share their experiences as a way of warning their colleagues about the dangers that exist in cyberspace.
Thomas N. Wells, a family lawyer in Summerfield, said he was contacted via e-mail to represent “Peggy Higashi.” He made contact with her, bought her story, and sent her a fee agreement, which she signed and returned. Because “Higashi” said her “ex” lived in Sumter County, Wells said no immediate red flags went up, although he did look up the lawyers’ names on the collaborative law agreement in the Journal directory to verify they were real lawyers. They are, although their names are being used unbeknownst to them. A check for $289,500 soon followed, which Wells deposited into his trust account.
“The real red flag went up when she e-mailed and asked me if I had received the money, and I e-mailed her back and said I had deposited the money. And then shortly thereafter I got an [e-mail] back saying, ‘please deposit the money tomorrow by 11:15 a.m.’ and [she] gave me all the disbursement information,” Wells said.
“Then I said, ‘This doesn’t quite sound kosher.’”
Wells e-mailed “Higashi” that he would not be wiring any money until he was sure the check cleared, “and of course I never heard back from her again.”
The check inevitably bounced and SunTrust alerted the Bar about the discrepancy in Wells’ trust account, “which is somewhat aggravating, but it could have been a hell of a lot worse.”
Wells said lawyers just need to follow the basic premise of not disbursing any funds until they are sure the check has cleared.
“I should have picked up on it sooner, but I was just a little bit foolish,” Wells said.
Naples attorney Sam Saad has seen two new wrinkles in scams targeting lawyers, both using real third parties to approach the attorney.
In one case, a friend was raising capital for a website-based enterprise and a person, claiming to be from South Africa, but in London for medical treatment, contacted the entrepreneur and offered to invest. The friend came to Saad to prepare the necessary legal papers and stock certificates.
Saad advised his friend that it was likely a scam, but the friend wanted him to proceed. Eventually, a check arrived from Canada, drawn on SunTrust. Saad called the bank to check on the account, and discovered the bank had never heard of it. Saad suspects the scammer was going to back out of the deal and demand his money be wired back, all before the fake check had a chance to clear.
Saad’s checking with the bank short-circuited that plan.
In another case, a “Chinese” client contacted a Realtor to buy a condo in Southwest Florida and asked the Realtor to find an attorney to handle the purchase. The Realtor turned to Saad, who became suspicious because the “client” sent a $500,000 cashier’s check for the $350,000 purchase price. The client asked that the extra $150,000 be wired to China to buy furniture, which would be shipped to Florida.
Saad told the “client” that no funds would be wired until the check had cleared, which would take up to 28 days. Sure enough, shortly before that period expired, the check was rejected.
His advice: “We as lawyers need to know who we are dealing with here.”
In addition, he said lawyers should be suspicious of anyone wanting to deal in large sums via cashier’s checks.
“There’s no reason for a cashier’s check,” Saad noted. “Wire transfers are basically free, and it’s verified funds.”
There’s also common sense.
The scammer in the Chinese scheme called to try to cajole him to send the money, and Saad deliberately drew out the conversation.
The longer the man talked, the more his “Chinese” accent became African.
Checking with the bank on the validity of a check verified David Norris’ suspicion that he was being targeted by a scammer. He was contacted in a scheme identical to many other Florida lawyers, where an “Asian” woman was trying to collect a divorce settlement.
Although suspicious, the Tavares lawyer played along, and eventually received a check for $245,000.
“This lady was going to give me $15,000 to basically process this,” Norris said, adding that only made his suspicions grow.
He checked with the bank, and “there were never funds available.”
Since then, Norris said he’s learned that banks have resources on their websites where lawyers can check the validity of checks — something he highly recommends.
Even though he was always suspicious of the “client,” he noted, “I wanted it [the check] to be good, but it wasn’t.”
Conning the Cons
When Joseph R. Fields, Jr., of West Palm Beach was targeted by e-mail scammers, he decided to string them along, figuring if the crooks were spending time with him, it was less time they had to prey on unsuspecting targets.
A few weeks into his supposed representation of the scammers, he received a $298,500 check via Federal Express.
Fields disagrees with those who say people should just ignore these scam e-mails.
“doing so, are we not following the actions of the neighbors of Kitty Genovese?” asked Fields, referencing the New York woman who was raped and murdered on the front steps of her apartment in 1964, while neighbors ignored her screams for help.
“All of us waste hours on the Internet. Spending a few moments responding to these idiots causes them to waste time and resources on those who will not be victims. ‘wasting’ three or four minutes of my time responding to these e-mails, I caused one of them to spend their money FedEx-ing me one of their checks.”
Fields said if enough lawyers lead the con artists on, the criminals may “look to other targets.”
‘The Scammers Almost Got Me’
Mary Fabre LeVine of Sarasota also had a run-in with fraudsters and considers herself lucky not to have been burned.
Although she had often deleted e-mails she recognized as scams, one day she received an e-mail from a “British businessman,” claiming to be Layton Sage of Sage Plumbing Equipment needing help to collect the balance due on the sale of plumbing equipment to an Orlando construction company.
It just so happens LeVine recently had dealings with that Orlando company, and she has had other British clients.
“It all made enough sense to correspond to see if this was a new, potential client I could help,” she said.
LeVine sent “Layton Sage” an engagement letter, which he signed and returned the following day.
“The very next day, I received two official checks payable to the firm,” she said. “One was for $5,000 for the retainer from ‘Layton Sage,’ and the second check was for $142,000 accompanied by a letter from the person I was supposed to sue.”
LeVine said it’s not often she gets large settlement checks before even making a demand, so she immediately called the construction company and asked if “Wesley Herst,” the man she was supposed to sue, worked there.
And turns out both checks were counterfeit.
“I was shaken up,” LeVine said. “The scammers almost got me.”
LeVine said she has since learned that most title companies are no longer accepting cashier’s checks for immediate disbursement at closings due to the significant increase in fraudulent cashier’s checks.
“The issuing bank may not advise you that the check is bad, because it is often trying to get money back and will not want to expose itself to you,” LeVine said. “So the approach of calling the bank is not as helpful as one may think.”
Scammers also are using the names of well-known locals to create a comfort level that the party you are dealing with is legitimate.
“So beware, be cautious, and do not issue any checks based upon the supposedly certified funds until you are certain the checks are good,” LeVine said.