IFA firm Continuum has warned advisers to be alert after a client was targeted by scammers in a sophisticated attack.

The Plymouth-based national IFA says firms need to have robust processes in place to safeguard clients amid signs wealthier clients are being targeted.

The warning comes after a 34% increase in investment scam losses over the past year.

Continuum says there are signs that scammers are targeting wealthier clients, often those who are served by financial advisers and planners.

Much of the risk lies in push payment fraud (APP - authorised push payment) where fraudsters pressure or cajole people to transfer money to them.

Ian O’Dowd, IFA at Continuum, said he received an email from a client asking to withdraw funds from his investments as he was looking to invest in property. The email was sent from his registered email address and written as if he had written it.

Mr O’Dowd said: “As I always make sure to receive confirmation via another form of communication I called him to ask about the email, and he said he had not sent it. The client even checked his sent items, and as far as he could see, an email had not been sent to me.

“Of course we then did not process the withdrawal and advised our client to close down that email account and set up a new one. We also reported the communication to the FCA as an attempted fraud.”

Continuum says the case involving one of its clients was some while ago but illustrated the sophistication of some fraud attempts and the intention to target better off clients, seeking higher fraud amounts.

Mr O’Dowd said: “Financial advisers may think that their clients are less vulnerable to fraud than those who do not take advice, but that does not mean that they are not still attractive targets for fraudsters.”

Continuum has several internal processes in place to help ensure clients do not become a victim of fraud. The first layer of protection is when clients make unscheduled withdrawal requests. Checks are then carried out using an alternative form of communication, so if the client calls in with the instruction the company will email the client  to check the request is legitimate. 

Continuum also has processes in place to account for financial pressure and/or blackmail, to help ensure no client is under pressure to make withdrawals that they are not comfortable with. Clients are also provided with educational materials on how they could help protect themselves from fraud.

Continuum, owned by M&G, has £2.5bn in assets under influence.