Fraud to watch out for: Out of Country Collections Cases

Solicitations like the one below are received now at my law firm and many others on an almost weekly basis. The scam goes like this: An e-mail is received bearing an out of country address and/or phone number attempting to hire a law firm to collect a clear “easily collectible” local debt. The nature of the scheme typically involves payment to the law firm from either the individual soliciting help or from the “third party” by means of a legitimate looking cashier’s check. This payment will come with an urgent request that some portion of the funds be disbursed back to the client immediately. Many firms have relationships with their banks such that immediate credit can be obtained on such a check. When the check is discovered to be fraudulent (days or weeks later) the law firm is left holding the bag. Take care to protect yourself. Best practice, if one is going to handle such matters, is to make sure that funds have cleared prior to disbursement.

LSA

On 11/30/2010 6:35 AM, [potential client] wrote:

Dear Counsel, I am requiring the services of your firm in the possible litigation of an overdue loan payment from an individual that resides in your state. I gave him a business loan for $350,000 in 2009 (February 4th to be precise). The terms for the loan was for 12months, with an annual interest rate of 7.85%. The loan matured on February 4th, 2010 and since then, He has only paid $50,000 after I sent him the demand letter 10 days after maturity. He still owes $300,000 plus the accrued interest on the capital. Please let me know if this is an area of practice/experience, so that I can send you additional information regarding this matter.

Your’s Truly
[potential client]
[address]
Belleville, ON, K8N1E9