After IOLTA scam, loss stays with firm
Bank meets duty of ‘ordinary care’
By: Kris Olson August 23, 2018
In what is being called a cautionary tale for attorneys, a Superior Court judge has found that a law firm that fell prey to a “classic internet scam” must bear the financial loss after wiring a large sum of money from its IOLTA account. ...This is an article straight out of MA Lawyers Weekly.
It highlights the lengths that a scammer will go to in order to extract $$ from someone and is key for someone who handles the purchase and sales of real estate, stock, assets etc., where receiving checks is routine.The article also focuses on the importance of understanding that a check from a client or third party does not equate to “good funds”.
Especially important for those of us who wire funds out in connection with closings.
Attorney rec’d a check for over $300,000, had it deposited, then at request of the scammer client, had a wire initiated out soon after. Once that wire had hit the scammer’s account, it came to everyone’s attention that the funds were no good but it was too late to recall the wire. Law firm was charged back the amount of the wire.
According to the article, “Had the bank just delayed wiring the money another six or seven hours, the check would have bounced, and the loss would have been averted”.
Link below. (subscription necessary to read full article)
https://masslawyersweekly.com/2018/08/23/after-iolta-scam-loss-stays-with-firm/Getting Ready for Convention!
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