Fraudsters Using Fake Email to Hack Brokerage Firms

According to a recent article from cnbc.com, fraudulent wire transfer emails by hackers are on the rise. According to the Financial Industry Regulatory Authority (FINRA), the authority first started noticing this trend five years ago, and are suggesting that investors be warned of this fact. Most firms have a two-factor authorization method to keep customers safe, but hacking continues to occur. In 42 cases going back to 2012, criminals hacked an investor’s email and requested brokerage firms make a wire transfer on their behalf. Criminals continue to use email schemes to defraud financial institutions and their customers using wire transfer requests. Many brokers then sign forms stating that they have spoken with the customer who made the request before processing the transaction, even when they had not. These brokers typically face suspensions and/or fines because of their actions. We have pursued FINRA arbitration claims against brokerage firms that failed to reasonably protect the assets of their customers. Firms have a duty to protect clients and prevent their accounts from being hacked. Brokerage firms like Merrill Lynch, Scottrade, Charles Schwab, Morgan Stanley, Fidelity, UBS, and Linsco have all been sued in recent years for security breaches when it comes to protecting client accounts. To learn how to sue brokerage firms, please call our investment fraud law firm at 312-332-4200. There’s no fee unless we win and recover.