Last week The New Lawyer reported that the Law Society of NSW has warned its member firms about a variation of what is now known as a Nigerian email scam that specifically targets Australian law firms.

Law firms have been landed with variations of the same scam, in which they are contacted by an overseas company, allegedly based in Japan, Mainland China or Hong Kong, requesting advice.  

"In one case the debtor company advised of had a brand in Australia and an email from the prospective client indicated that there has been agreement to a part payment of the debt," the Law Society warns.

Small boutique and small mid-tier firms are being targeted, sources have told The New Lawyer. 

It is understood that at least one mid-sized firm has already fallen for the scam in New South Wales. 

One source noted that a mid to large-sized firm would not pay out the trust account until funds cleared. 

Another source said he had been approached in such a scam, but would only speak anonymously. 

It is understood that larger firms are less likely to accept work from clients via email, and that work is usually obtained from long-term relationships and face-to-face meetings. 

While Australian firms appear to have been the most recent targets of the scamming, US firms and other types of businesses have long been warned of the potential risks of such offers of work. 

There has been an upswing in the number of small firm lawyers from across the US being contacted by mostly Asian companies looking for help collecting debts. 

Many lawyers in the US have been contacted by a company calling itself Eagle Power Equipment. 

A lawyer in Houston, US, was forced to take a home equity loan to repay his law firm $182,500 lost in an email scam. Lawyer Richard Howell received an email from someone who claimed to be a Japanese businessman, who needed help collecting $3.6 million from four customers in the United States. 

Howell's firm, Buckley, White, Castaneda & Howell, would get a contingency fee of one-third for any money collected. 

"To me, it sounded like it could be a potentially lucrative client from Japan," Howell told Texas Lawyer, the legal magazine. 

The firm received a collection cheque of $367,500 and, believing it has cleared, sent $182,500 to the fake client in Hong Kong. The firm has since filed a suit against Citibank in a Houston court.

The Houston-based suit contends the check was labeled "Citibank Official Check" and a Citibank employee verified that the money had been paid, a representation that turned out to be wrong when the check bounced.

Howell told Texas Lawyer that he hopes his own experiences will prevent other lawyers and firm from making the same mistake. "I'm a capital D Dumbass," he said.