Yacht purchase agreement scam using the name Gary Seidel or Lia M. Nelson
Date First Reported: March 2015
Primary Name Associated: Gary Seidel
Description of Potential Fraud:
Firms in BC, Ontario and Quebec have notified us that they received an email from the purported Gary Seidel (or Lia M. Nelson) looking to retain them with regards to purchasing a yacht. The name Gary Seidel has also appeared in a business debt collection scam.
This is a bad cheque scam that presents as legal matter requiring the assistance of a lawyer. In this scam lawyers will be duped into wiring real funds from their trust accounts after depositing a fake cheque received as payment from the purchaser (who is part of the fraud). See our Confirmed Fraud Page for more of an explanation of how these frauds work and to see other names associated with it. Our Fraud Fact Sheet lists the red flags of a bogus legal matter that is really a fraud.
Here is the initial contact email sent by the fraudster to the lawyer:
From: Gary Seidel [mailto:[email protected]]
Sent: March 20, 2015 5:27 AM
To:
Subject: Maritime services
Hello Barrister,
My name is Gary Seidel and I’m a boat enthusiast and immediate past vice president of the local marine club. I’m seeking your services as a maritime lawyer and would like to know if you are accepting new clients at this time.
Your prompt response will be highly appreciated.
Thank you.
G. Seidel
Replying to the email brought this response:
Glad to hear from you. I only just saw your email in my spam folder, I don’t check it regularly. Concerning the services I seek, I’m in the process of buying a vessel and need you to act as a mediator in a pending yacht purchase. The vessel in question is a custom built 80ft yacht (2005) with Twin 1,679HP Engines listed for sale by a broker for $1,400,000.
After making a few calls and some negotiation, a written offer has been prepared (Purchase & Sale Agreement, or P & S document) for $1,250,000 by the Japanese broker. As a mediator, I’m sure you are familiar with yacht sales procedure. Serious offers are to be accompanied by a 10% escrow deposit in order to be considered by the vendor. However, due to the location of the vessel and broker (Yokohama, Japan), I have insisted on the use of a NEUTRAL third party as escrow holder to safe guard my deposit so that it stays in Canada until all conditions of purchase (sea trial, survey and inspection) are complete. I intend to travel to carry out the inspection and hire the services of a marine surveyor.
I have reserved the right to choose the neutral third party that will act in this capacity and the vendor is in agreement so that the deposit sum can be held locally pending resolution of this sale; thus the need for your services as a mediator which ensures professional conduct.
It has been mutually agreed that the fees for this service shall be split equally between myself and the vendor so let me know.
Escrow fees are usually 3.5% of the escrowed sum. If your cost for acting in this capacity is different from the industry standard, do indicate and I will communicate same to the vendor for his nod or otherwise.
Regards,
G. Seidel
How to handle a real or suspected fraud
If you have been targeted by any of these frauds, please forward any of the emails and supporting documents that you have received to [email protected]
If you are an Ontario lawyer who suspects you are acting on a matter that might be a fraud, call LAWPRO at 1-800-410-1013 (416-598-5899). We will talk you through the common fraud scenarios we are seeing and help you spot red flags that may indicate you are being duped. This will help you ask appropriate questions of your client to determine if the matter is legitimate or not. If the matter you are acting on turns out to be a fraud and there is a potential claim, we will work with you to prevent the fraud and minimize potential claims costs.
What can you do to help put a stop to the fraud attempt? You can simply stop replying to the fraudster’s emails or inform them that you suspect fraud and will not act on the matter (or will take no further actions on the matter). You can report the fraudsters email addresses to the email hosting company. If you have a fraudulent cheque you can destroy it or send it to the fraud department of the financial institution, which may wish to see it. In Canada, you can report the fraud to the Canadian Anti-Fraud Centre.
We are often asked if it is worthwhile to report the fraud attempt to the police in the hopes of helping catch the fraudsters. You can certainly report the fraud to your local or federal law enforcement agencies, but unfortunately it is often difficult, expensive and time consuming for them to attempt to shut down these online fraud perpetrators (though there are some successes).
If you have been successfully duped, please immediately notify LAWPRO as there may be a claim against you. Instructions on how to report a claim are here.
For more immediate updates on fraud and claims prevention, subscribe to the email or RSS feed updates from LAWPRO’s AvoidAClaim blog.
Fraud Fact Sheet More fraud prevention information and resources are available on the practicePRO Fraud page, including the Fraud Fact Sheet, a handy reference for lawyers and law firm staff that describes the common frauds and the red flags that can help identify them.
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