In 2023, Australians fell victim to redirection scams, losing a staggering $91.6 million. These scams involve criminals impersonating legitimate businesses, often through email, to deceive individuals into transferring funds.
The sophistication of these scams is rising as fraudsters enhance their tactics with design details and AI-generated text, creating convincing replicas of emails that appear to come from trusted sources.
A recent case in Melbourne highlights the severity: a family was swindled out of $500,000 by scammers posing as their conveyancer during a property transaction. The fraud was only discovered after the money had been transferred to the scammer’s account, following a hack into the conveyancer’s web server and the dispatch of an email with fake bank routing information.
The family is currently awaiting confirmation on whether their conveyancer’s indemnity insurance will reimburse the loss.
Livesign, an Australian digital identity firm, has pointed out that email is no longer a secure method for financial transactions due to these risks.
Livesign CEO Lara Paholski emphasized that Australian consumers and businesses, especially in sectors like real estate, are highly vulnerable to cyber scams, given the substantial amounts of money often involved.
Paholski explained that scammers’ focus on these sectors puts significant pressure on business owners to protect their clients from fraud and to safeguard their own company reputations.
Given that email technology is over 50 years old, it is relatively easy for malicious actors to intercept digital communications, according to Paholski.
The Real Estate Institute of Western Australia (REIWA) has also reported a rise in rental redirection scams, exacerbated by the stressful rental market and the tendency of prospective tenants to rush into seemingly good deals.
REIWA cautions that if an offer seems too good to be true, it likely is. They advise prospective tenants to view properties in person, conduct thorough checks, and always confirm payment details with the landlord or property manager before making any payments. Additionally, renters should avoid sending any bond or rent until their rental application is approved and they have a signed lease agreement.
