Social Engineering Fraud
Key Takeaway
A deception technique where criminals manipulate individuals into transferring funds or revealing confidential information by impersonating trusted parties. In law firms, the most common form is business email compromise targeting trust accounts, where fraudsters impersonate clients or co-counsel to redirect wire transfers.
Definition
A deception technique where criminals manipulate individuals into transferring funds or revealing confidential information by impersonating trusted parties. In law firms, the most common form is business email compromise targeting trust accounts, where fraudsters impersonate clients or co-counsel to redirect wire transfers. Cyber policies may cover these losses.
Why This Matters for Law Firms
This term defines the boundaries of what your insurance will and will not pay for. Law firms that misunderstand coverage terms risk discovering gaps in protection only after a claim has been filed, when it is too late to remedy the situation. Reviewing these terms with your broker before binding coverage is a critical risk management step.
Example Usage in Context
During a coverage review meeting, the firm administrator might note: "Our policy includes a social engineering fraud provision -- let's make sure we understand exactly what that means for our specific practice areas before we sign off on the renewal."
Related Q&A
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