Key takeaways
Fraud risks are rising for professional firms
Deepfakes, APP scams and identity theft are targeting trusted service providers.
Prevention starts with strong controls
Clear processes, staff training and vendor checks help reduce exposure.
Fast action is crucial after a breach
Isolate systems, preserve evidence, and seek legal advice quickly.
Banking fraud continues to pose a significant threat to organisations operating within the professional services sector. Whether advising on financial transactions, managing client funds, or acting as intermediaries, professional services firms are particularly vulnerable to increasingly sophisticated fraud schemes. At Hill Dickinson, our Civil Fraud & Investigations team is well-versed in supporting clients through these challenges, offering strategic, sector-specific legal guidance to mitigate risk, respond to incidents, and recover losses.
Understanding the risk landscape
We act for a broad range of clients—from international PLCs pursuing multi-million-pound High Court proceedings to individual professionals such as accountants who have been personally affected by banking fraud. The types of fraud we encounter are varied and increasingly complex, such as:
Cheque fraud committed internally by senior personnel.
Identity fraud involving impersonation of clients to secure loans or register charges over property.
Third-party fraud exploiting weaknesses in digital banking systems or client verification processes.
False accounting fraud involving employees or organisations altering, destroying or defacing any account, or presenting accounts that do not reflect their true value.
For professional services firms, the stakes are particularly high given the trust placed in them by clients and the sensitive nature of the transactions they handle.
Getting ahead of banking fraud
As fraud tactics evolve, professional services firms must stay ahead of increasingly sophisticated threats. The rise of authorised push payment (APP) fraud, deepfake-enabled identity theft, and synthetic identity fraud has created new vulnerabilities, particularly for firms managing client funds or facilitating financial transactions. Real-time payments and open banking, while enhancing efficiency, have also introduced risks that fraudsters are quick to exploit.
We encourage professional services organisations to take proactive steps to reduce exposure to banking fraud. Key areas to consider include:
Internal controls and governance: Implement robust procedures for verifying transactions and managing access to client accounts. Regular risk assessment should be carried out to identify and rank fraud risks across business processes. This may include, for example, mapping out vulnerabilities such as fictitious vendor schemes or unauthorised access to financial systems. Preventative controls should be implemented, e.g:
Segregation of duties: Ensure no single employee has end-to-end control over financial transactions.
Access controls: Apply the principle of least privilege to both IT systems and physical assets, whereby only the minimum level of access or permissions necessary to perform their specific tasks is given.
Regular reconciliations and audits: Use detective controls to catch anomalies early.
Staff training: Ensure employees are aware of common fraud tactics and know how to escalate concerns as they are the first line of defence. Training should be:
Role-specific: Tailor content to different functions, e.g. finance teams should focus on wire fraud and vendor scams, while client-facing staff should be trained to spot identity theft and APP fraud.
Scenario-based: Use simulations to teach staff how to respond to suspicious behaviour, such as unusual payment requests or phishing emails.
Ongoing and adaptive: Regular refreshers and testing (e.g. simulated phishing attacks) reinforce learning.
Inclusive of cyber threats: Ensure staff understand how to protect sensitive data, use multi-factor authentication, and avoid social engineering traps.
Third-party risk management: We understand that professionals services firms often rely on external providers for banking, IT, and compliance functions. These relationships can, sometimes, open the door to significant fraud risks if not properly managed. Best practices include:
Due diligence: Vet third-party vendors thoroughly before engagement, assessing their fraud prevention capabilities and compliance history.
Contractual safeguards: Include clear fraud prevention obligations and audit rights in vendor agreements.
Ongoing monitoring: Regularly review vendor performance, access controls, and incident response protocols.
Governance and accountability: Maintain oversight throughout the third-party relationship lifecycle, ensuring that responsibilities are clearly defined and documented.
Responding to banking fraud: immediate steps for professional services firms
Despite best efforts to get ahead of banking fraud, sometimes it is not possible to prevent it. When banking fraud is suspected or confirmed, time is of the essence. Professional services firms must act swiftly and decisively to contain the damage, preserve evidence, and initiate recovery efforts.
Isolate and secure affected systems
Suspend access to compromised accounts or systems to prevent further unauthorised activity.
Preserve digital evidence by avoiding system resets or deletions – this is crucial for forensic analysis.
Notify internal stakeholders such as compliance, IT, and senior leadership to coordinate a unified response.
Conduct a rapid internal investigation
Identify the nature and scope of the fraud, i.e. what was accessed, how, and by whom.
Engage forensic experts where necessary to trace transaction trails and uncover vulnerabilities.
Document all findings carefully for legal and regulatory purposes.
Notify relevant third parties
Inform your bank immediately to freeze suspicious transactions and accounts.
Contact insurers if your firm holds cyber or crime insurance policies.
Alert affected clients, balancing transparency and reputation.
Seek legal advice
Seek legal advice from those with expertise in civil fraud and asset recovery. Early legal intervention can be critical in securing freezing injunctions or pursuing Norwich Pharmacal Orders to obtain key information from banks and other third parties.
Consider private prosecution if criminal proceedings are warranted and public enforcement is delayed or unavailable.
Report to regulators
Depending on the nature of the fraud and your regulatory obligations, you may need to report the incident to:
The Financial Conduct Authority (FCA)
The Information Commissioner’s Office (ICO) (if personal data was compromised)
Professional bodies such as the SRA, ICAEW, or ACCA
Review and strengthen controls
Conduct a post-incident review to identify control weaknesses.
Update policies and procedures to prevent recurrence.
Communicate lessons learned across the organisation to reinforce a culture of vigilance.
How we can support you
Our tailored approach to banking fraud litigation includes:
Asset recovery and freezing injunctions: We act quickly to trace and secure misappropriated funds where possible.
Private prosecutions and Norwich Pharmacal Orders: These tools are particularly effective in compelling banks to disclose key information about fraudulent transactions.
Internal investigations: We are able to assist you with uncovering the source and scope of fraud, often working alongside forensic experts and IT specialists.
We combine legal acumen with a pragmatic, client-focused approach, offering end-to-end support from investigation to resolution.
If your organisation is facing banking fraud issues or wants to strengthen its fraud prevention strategy, please contact our Civil Fraud & Investigations team today.
