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Bogus check scam going strong

Law firms in the Roanoke-Salem area are the latest to report a series of emails baiting lawyers for an apparent fraud scheme.

Firms say they have received email inquiries about representing a foreign company in a local debt collection matter, reports the Salem/Roanoke County Bar Association.

It’s a variation on a common swindle that’s been targeting law firms nationwide and in Virginia. The Virginia State Bar described the practice as the familiar “Nigerian mail scam” on steroids.

The ruse usually involves apparently well-established businesses. Just as the law firm gets ready to file a collection action, the matter is declared settled and a large cashier’s check arrives, payable to the law firm.

The law firm is urged to deposit the check, recover its fee, and quickly wire to the balance to an overseas account. Sharp-eyed lawyers often learn the cashier’s check is counterfeit before it is too late, but some targets do not.

Recent email inquiries reported in the Roanoke Valley involve a supposed $514,000 debt owed by a “James Richmond” in Salem. The would-be client is a “Daido Steel Corp.” in Japan. The email describing the case includes a contract for representation, according to the S/RCBA report.

The bar association said the sender later requests information for making a transfer to the lawyer’s bank account and then uses the information to withdraw money from the account.

Warning signs include the quick appearance of a settlement check, before the lawyer has a chance to call the supposed debtor, and an envelope with a Canadian postmark, even though neither of the businesses has any connection to Canada.

A Virginia lawyer was spared as a victim when his secretary spotted a Canadian postmark and the lack of a return address on an envelope with such a check, according to the VSB’s report in December.

When any questionable check is deposited, the lawyer should be cautious not to disperse any proceeds until the check has “cleared,” not when the bank says “funds are available,” said VSB Ethics Counsel James M. McCauley.

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