Camille Stell

Wire Instruction Fraud Plagues NC Lawyers

Over the last few weeks, Lawyers Mutual has received multiple reports of North Carolina attorneys who were targeted by scammers attempting to divert seller closing proceeds following real estate transactions.  Unfortunately, several of these attacks were successful and hundreds of thousands of dollars were stolen and are very unlikely to be recovered.

I’ve asked our claims attorney, Troy Crawford, to talk with me about what went wrong and how to prevent it.

Troy: While the details of the recent scams are emerging, it appears hackers first became aware of the closing by compromising email accounts of differing parties.  Sometimes the attorney account was compromised, sometimes the Seller’s account was compromised but the most common scenario was the Realtor’s account was being monitored by international criminal organizations.

Camille: Sounds scary. How does this scam work?

Troy: The foreign-based hackers would observe the account, likely for several weeks, and only actively intervene once an understanding of the business practices were obtained and a significant wire was to be produced.  In the interim, the unsuspecting Realtor would continue to use the account unaware his or her client and the closing attorney were being set up to be robbed.

Camille: What can lawyers do to avoid falling victim to the latest series of scams?

Troy: EVERY wire request should be verified and the more personal the verification, the better. The best way to verify wiring instructions is to have the Seller sign the wiring instructions at the closing ceremony in the presence of the attorney.  We know of no wire fraud which has taken place when this has occurred, and even if it did, the closing attorney would likely be insulated from liability by the doctrine of contributory negligence.

If the Seller is unable to attend the ceremony, we recommend the wiring instructions be included in the same package in which the deed is delivered.  In these situations, have the Seller sign wiring instructions and have the signature notarized, if possible.  Even then, we recommend the Seller verify the closing instructions over the telephone via a call initiated by the law office, using contact information from very early in the file prior to any discussion of proceeds and wires.

Confirming a telephone call verification via email is a good practice and a great way to document the file.  However, an email verification alone is inadequate.

If at all possible, do not accept changes to wiring instructions.

Camille: Many professionals are still using free email services such as gmail, yahoo, aol.com, and nc.rr.com. What are your thoughts about the risk with these free services?

Troy: If wiring instructions are attached to an email from a free email service (gmail, yahoo, aol.com, nc.rr.com, etc.) they should be assumed to be fraudulent and extra diligence should be taken in verifying their authenticity. Sometimes hackers will set up an alias account with a very similar name (frequently dropping or swapping letters) to send modified instructions so the authentic user is not aware of their presence.  Examining the account name in detail is a good idea; however, as the hacker already has access to the original account, he or she may be not take this step and will use the same account that all other correspondence used.

Attorneys should be using secure email. Secure email essentially means that an email travels from sender to recipient without interruption, alteration, or interception. It allows the recipient to be sure of the sender’s identify and the validity of any attachments to the email. Most free email services do not offer these protections that you pay for with secure email providers.  In addition, free email services are likely non-complaint with the ALTA Best Practices because of these major security concerns and the emails are likely being mined for data by their providers in violation of Rule 1.6 of the Rules of Professional Conduct.

If you are currently using a free service, immediate action should be taken to find a more secure and professional alternative.  In the interim, it is possible to see when and from where the free account was recently accessed.  Here is a link explaining how to do it for gmail accounts:  http://www.groovypost.com/howto/check-gmail-login-activity/ Other services should have similar abilities.  If you see suspicious activity, please immediately change account passwords and contact your professional liability carrier along with your cyber or crime carrier.

Camille: What are some other red flags?

Troy: Be very suspicious of wires going to any account that is not in the name of the Seller.  Also, be suspicious of any account with a geographic location different than the Seller.  Why is a North Carolina Seller relocating to New York sending a wire to Wisconsin? There are some reasons for the different names and odd locations, but these are red flags which should be explored in detail (and not via email).

Do NOT send wires overseas.  Once money leaves the United States, it is likely gone forever.

Finally, regularly change your passwords.

While these policies appear harsh, hacking crimes can be devastating to a law firm’s finances and reputation.  Explaining the policy up front to your clients is a good way to limit negative actions. Also, be sure to share this information with your support staff. Many paralegals are on the front line of communications concerning closing instructions.

Below is sample language Lawyers Mutual recommends to be included in your Seller engagement letter:

Funds Availability Policy.
It is our goal to make real estate commission checks and funds available as soon as practical following closing.  However, NC State Bar Rules expressly prohibit disbursing any closing funds prior to recording.  Should you request funds be wired, our office can accommodate the request for a fee of $___.00.   In order to prevent fraud and protect your proceeds, all wiring instructions must be will be verified and you will be required to sign the instructions at the closing ceremony.  THIS OFFICE WILL NOT ACCEPT CHANGES TO WIRING INSTRUCTIONS.

Camille Stell is the Vice President of Client Services and Troy Crawford is a claims lawyer for Lawyers Mutual. Continue this conversation by contacting Camille at camille@lawyersmutualnc.com or Troy at troy@lawyersmutualnc.com or 800.662.8843 for an in-house presentation on Cyber Security. Contact Adam Pierce, AAI, Director of P&C Operations with Lawyers Insurance for information on cyber insurance policies at adam@lawyersmutualnc.com.

NCAWA 2016 Annual Conference

The NCAWA Education Committee is excited to announce our 2016 Annual Conference will be held September 22nd through September 24th, 2016 at the Crowne Plaza Resort in beautiful Asheville, North Carolina! We have a great weekend planned with CLE courses (up to 5 credit hours available) and speakers on a number of big issues arising for women in the legal profession here in North Carolina.

To register, follow this link: NCAWA 2016 Annual Conference

To view the Conference Brochure with detailed information about CLE court offerings and the weekend agenda,
follow this link: 2016 Conference Brochure

The NCAWA room block is active and you can set up your reservation now by following the instructions below:

Call our toll-free number 1-888-211-7755 (24/7) and mention the group name NC Association of Women Attorneys in order to receive the special group rate.

Visit the Crowne Plaza website and book online: www.ashevillecp.com

  Check Availability (enter dates of stay) and enter Group Code: WAT

You can use this link to automatically add the group code when booking online: Make Your Reservations Online!

If you have any questions about the 2016 Annual Conference, please contact either Manisha P. Patel (manisha.p.patel@gmail.com) or Alexis Solheim (alexis.solheim@gmail.com), NCAWA Education Chairs.

NCAWA 2016 Annual Conference

NCAWA 2016 Annual Conference

dan mcginn

Wake Forest Law Review Names Annual Banquet After Brooks Pierce Attorney

The Wake Forest Law Review has named its annual banquet after Brooks Pierce partner Dan McGinn. The surprise announcement was made at the Law Review’s 2016 event, which was held April 15.

 Suzanne Reynolds, dean of the Wake Forest University School of Law, praised McGinn, recounting tales of his scholarship as a student and his success as a lawyer.

 “Our law school is incredibly proud of Dan McGinn, as I know his partners are,” Reynolds said. “He is an example of what we hope every student of the law will strive to be.”

dan mcginn

dan mcginn

 McGinn, a labor and employment lawyer, received his bachelor’s degree from Wake Forest University in 1964 and his juris doctorate from Wake Forest University School of Law in 1967. He continues to give back to his alma mater, chairing the Wake Forest University School of Law Alumni Council from 1996-1997 and serving several terms as a member of the Wake Forest University School of Law Board of Visitors.

 “I was surprised and humbled to have received this recognition,” said McGinn. “Wake Forest University School of Law played such a significant role in shaping who I am as an attorney. It has been my privilege to give back to the school and its students, and I feel honored that the school would acknowledge me in this way.”

ed winslow

Ed Winslow Receives Leadership Award From Greensboro Chamber of Commerce

Brooks Pierce partner Ed Winslow was recently honored by the Greensboro Chamber of Commerce with its Denise E. Maleska Leadership Service Award. The award, which was presented at the annual Leadership Greensboro graduation dinner on May 18, recognizes an individual who has shown lifelong dedication to leadership and community service.

 “I am so pleased to be recognized in this way,” Winslow said. “It’s a genuine honor to be associated with Greensboro’s vibrant tradition of community engagement and its many, many servants and leaders. I am a member of a great law firm and I live in a great city. Trying to make a contribution is what you do when you have that.”

ed winslow

ed winslow

Since moving from Tarboro to Greensboro in 1974, Winslow has contributed to a number of local and regional community initiatives, boards and organizations. He has held leadership roles with Hospice of Greensboro, the United Arts Council, the Canterbury School, the Carolina Theatre Commission and the Greensboro Economic Development Partnership, among other organizations. He is currently the chairman of the Guilford College Board of Trustees, a role he was elected to in 2014 after joining the board in 2005.

 An attorney with more than 40 years of experience, primarily in banking law, Winslow served as managing partner of Brooks Pierce from 2000 to 2015. During his tenure, the firm grew in both size and reputation as the go-to firm for complex business litigation, constitutional controversies and sophisticated business governance, regulation, planning and transactions.

 “I could not think of anyone more deserving for this award,” said Reid Phillips, managing partner of Brooks Pierce. “Through his dedication and service to so many organizations, Ed helped to create a culture of community service at Brooks Pierce that has been embraced by so many of our attorneys. Ed has made a lasting impact on many community organizations, including our libraries, our arts programs, our professional associations, and our educational institutions. He is an outstanding example of the type of community leadership to which we should all aspire.”

NOTICE: SPECIAL JOINT MEETING

18th Judicial District Bar/18-H Judicial District Bar

TO:  Members of the Bar, 18th Judicial District and 18-H Judicial District

FROM: Ken Keller, President of the 18th Judicial District Bar and Kim Floyd, President of the 18-H Judicial District Bar

RE: Notice of Special Joint Meeting for the Selection of Nominees for the District Court Vacancy occasioned by the retirement of the Honorable Wendy Enochs; Notice of Meeting to Amend Bylaws of 18th Judicial District

Notice: Pursuant to N.C. Gen. Stat. §7A-142 and the Bylaws of the 18th and 18-H Judicial District Bars, notice hereby is given that a SPECIAL JOINT MEETING OF THE 18th and 18-H JUDICIAL DISTRICT BARS will be held on September 29, 2016 at 3:30 p.m. in the Commissioners’ Meeting Room (the Old Superior Court Room) at the Old Guilford County Courthouse at 301 West Market Street in Greensboro, NC, to 1) amend the Bylaws of the 18th Judicial District (a copy of the Bylaws with proposed Amendments is posted on the Greensboro Bar website http://greensborobar.org and will be circulated by e-mail); and 2) select nominees to submit to the Governor to fill the District Court judicial vacancy occasioned by the July 31, 2016 retirement of the Honorable District Court Judge Wendy Enochs. Member check-in and distribution of ballots will begin at 3:00 p.m.

Candidates/Applicants:  Any member of the 18th Judicial District Bar or the 18-H Judicial District Bar who wishes to be a candidate for the judicial seat and who is a resident in either district must notify us of her or his intention in writing, no later than 5:00 p.m. on Friday September 23, 2016. Notification shall state that he or she is duly authorized to practice law in the 18th and 18-H Judicial District Bars and that his or her residence address is located within either district.  Notification should be delivered or mailed to the 18th Judicial District Bar president Ken Keller, Carruthers & Roth, P.A., 235 N. Edgeworth Street, Greensboro, NC 27401 or e-mailed to krk@crlaw.com, or delivered or mailed to the 18-H Judicial District Bar president Kim Floyd, Joe D. Floyd Law Firm, P.A. 401 S. Main Street, High Point, NC 27260, or e-mailed to kfloydatty@northstate.net. (If you send notice by e-mail, please request confirmation that the e-mail is received.)

Persons desiring to be considered for election are requested to submit a statement of personal and professional information concerning the applicant’s credentials.  Such information will be posted at the website of the Greensboro Bar Association at www.greensborobar.org several days prior to the election meeting to assist members of the 18th and 18-H Judicial District Bars to evaluate candidates.  Participation by applicants in this evaluation is voluntary.

Speeches by Candidates:  Beginning after announcements at approximately 3:30 p.m., each candidate for district court judge will be allowed five minutes to address the members present.  To accommodate our members’ varying schedules, voting will be allowed AFTER announcements (i.e., voting will be allowed before, during, and immediately following the speeches).  We encourage you, however, to listen to the presentations of the candidates.

Voting: Voting shall be limited to those attorneys licensed to practice in North Carolina who are in attendance at the joint meeting and are members and residents in good standing in either the 18th Judicial District Bar or the 18-H Judicial District Bar.  An attorney is not authorized to vote if he or she is merely practicing but not residing in either district. [A current membership roster will be obtained from the North Carolina State Bar prior to the meeting. If you recently transferred to this district, please contact the North Carolina State Bar to make sure your information is current.]  Members of districts 18 and 18-H who reside outside the districts are encouraged to attend but not entitled to vote.  The ballots shall be counted immediately after the completion of the speeches.  Proxy voting is prohibited.

Each voting member of the 18th and 18-H Judicial District Bars shall be entitled to vote for up to five candidates for the judicial seat by secret written ballot.  Ballots marked for more than five candidates shall be disqualified. Cumulative voting is prohibited. [Cumulative voting is where a member votes more than once for a given candidate.]  The five candidates receiving the highest number of votes cast shall be the nominees to fill the vacancy in the District Court.  In the event of a tie for fifth place, the names of those candidates involved in the tie shall be transmitted to the Governor together with the names of the four candidates receiving the highest number of votes.

Results of the Elections:  The results of the election shall be announced at the meeting.  Following the meeting, we will transmit to Governor McCrory the names of the five candidates (six if there is a tie for 5th place) receiving the most votes for the District Court Judge seat along with the number of votes for each. The entire 18th Judicial District Bar and the 18-H Judicial District Bar will be notified by e-mail of the results of the election, and the results will be listed on the Greensboro Bar Association web site, www.greensborobar.org and in the newsletter of the Greensboro Bar Association.

Please attend and vote at this important joint election meeting.

Thank you.

Ken Keller
President, 18th Judicial District Bar

235 N. Edgeworth Street
Greensboro, NC 27401

krk@crlaw.com

Kim Floyd
President, 18-H Judicial District Bar

401 S. Main Street,
High Point, NC 27260

kfloydatty@northstate.net

Smith Moore Leatherwood Named as BTI Consulting Group Brand Elite 2016

Smith Moore Leatherwood LLP has been named to BTI Consulting Group’s Brand Elite 2016, which recognizes the top firms in the country for their reputation or brand.  According to the report, BTI Brand Elite 2016: Client Perceptions of the Best-Branded Law Firms, Smith Moore Leatherwood stood out for its innovation and earned a place on BTI’s Honor Roll of Value-Driving Firms.

The report includes the results of extensive interviews with more than 600 corporate counsel at the world’s largest and most influential companies on nine key factors that differentiate law firms, including innovation in services and technology, client recommendations, accomplishments in client work, value drivers, and more.

“We are honored that our clients feel that our firm continues to live up to its reputation of excellent work at a great value,” said Julie Earp, Managing Partner.

Book Buddies: We Need You to Share Your love for Reading

This year the Young Lawyers Section is excited to open its Book Buddies program to all GBA members. 

To find out more about the program and how you can get involved, just keep reading….

What is Book Buddies?

Book Buddies is a volunteer program that pairs lawyers with classrooms at Hampton Elementary (pre-K through second grade) to read aloud to the class for thirty minutes to an hour.  You’ll work with one classroom during the school year.  At the end of the year, we also provide a book for each kid in each classroom that we serve.

I’m really busy, so how much time will it take?

However much time you want it to take.  Once you’re paired with a classroom, you work with the teacher to schedule mutually agreeable reading times.  You don’t have to follow a particular schedule.  Simply e-mail the teacher to set up a reading session, schedule it for whenever is best for you and the teacher, and go read.  A few weeks later, schedule another session.  This flexibility works really well with attorneys’ schedules.  How long you’ll read during each session is up to you and the teacher.  You’ll probably end up reading two or three books each time you visit the class.  Hampton Elementary is about eight minutes from downtown Greensboro, so overall you are looking at a maximum time commitment of an hour and a half for each visit—and it’s often less than an hour.

Books—what do you mean? What if I don’t have kids’ books readily available?

You might have books at home that you can read to your class.  Illustrated books are best.  If you don’t have suitable books at home, Hampton’s library has an “honor-system shelf” where you can get books to read and return before leaving.  You can also buy books or check them out from the public library.  We’re also working with Hampton to establish a means for us to check out any book from Hampton’s library.  Also, most of the teachers have a decent collection of books in their classrooms, and you can probably rely on those in a pinch.

Why is this program so important?

Hampton needs us!  In 2014, Hampton was identified as a “turnaround school” by the Guilford County School System due to its low test scores: http://www.greensboro.com/news/article_c5f64852-bed2-11e3-ad48-0017a43b2370.html.  Hampton, the Guilford County School System, and volunteers are working hard to improve the school, and we can be part of the solution.  From what we’ve seen so far, the kids and teachers love the Book Buddies program.  The kids love hearing the books read aloud, and they love to ask questions about being a lawyer.  The teachers love it because it gives them some time to take a breath and catch up on paperwork.  As for you, you’ll probably find that it’s really fun and makes for a nice midday break from lawyering.

I love this idea.  How do I volunteer?

If you are interested in signing up, please (1) register to be a Guilford County School volunteer here: https://www.gcsvolunteers.com/ and (2) email Whit Pierce at whit.pierce@smithmoorelaw.com and let him know so he can put you in touch with a teacher at the school.

Greensboro bar Association's YLS

Adam Kerr with Ms. Kalisha McNair’s pre-K class at Hampton Elementary School.

NCCALJ Interim Reports Now Available

A Compilation of Interim Reports from the North Carolina Commission on the Administration of Law & Justice now available here: NCCALJ Interim Report