There is yet another internet fraud making its way to lawyers.
This scam goes like this:
Lawyer James Jones receives an unsolicited e-mail from an Alex Wilford in England.
Wilford claims that he is owned money under a settlement agreement for personal injuries with his former employer in New York. The former employer agreed to pay $175,000 but has paid only $55,000 thus far. Wilford wants Jones to collect the balance.
In the e-mail Wilford asks Attorney Jones to sue for $120,000 which is the unpaid balance. Jones falls for the bait and agrees to handle what appears to be a routine collection matter for an 1/3 contingency fee.
Within a week of being hired Jones is able to settle the matter on a mere letter of representation. Jones is overjoyed on making a hefty fee on so little work. He receives a bank check for $120,000 which he quickly deposits into his escrow account. The funds clear in about 2 days, and Jones immediately wires $80,000 to Wilford’s bank in England. Jones retains $40,000 for his fee.
About 5 days after the funds were wired to Wilford, Jones’s bank charges back the $80,000 because the bank check was counterfeit. Jones’s bank claims that it is permitted to charge-back on a fraudulent check. Jones is stuck , and he must fight his bank to try to get back the $80,000. Of course, Wilford and his gang have fled into the internet ether with Jones’s $80,000.
First, the internet criminals cooked-up the “unpaid invoices collection” scheme. Next, they circulated the “unpaid divorce judgment” routine. Now, they are circulating a new variation, “the unpaid personal injury settlement agreement.”
Mark E. Seitelman, 8/18/10, www.seitelman.com.