Home buyers are being targeted by a new scam which tricks them into paying their deposit money to fraudsters instead of a legitimate trust account.

Banking Ombudsman Nicola Sladden says real estate agents and lawyers are being targeted in a sophisticated "invoice scam" in which people hack into the email of those companies and then send out legitimate-looking invoices.

Instead of the invoice having the bank account of the law firm or real estate agent it is replaced by a scammer's account number and the money goes straight to them.

"We are getting lots of queries about it over the phone lines and banks are also saying they are seeing it."

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Sladden said the New Zealand Law Society put out a warning to its members about it at the end of last year after the scam hit lawyers in Queensland.

She said the scam began with people approaching a law firm wanting to be a client. Often they say they are interested in buying a property and want the law firm to do the conveyancing for them.

Emails then go back and forth between the parties with more details exchanged until the "client" agrees to use the firm.

Then the scammer sends a supposedly important document which can only be accessed by the person they have been dealing with at the law firm which requires them to put in their email address and password.

Once that happens the scammer gets access to the person's email and can monitor other settlements and payments coming into the firm.

The scammer then sends an email out to remind a person who is due to pay their home deposit close to the deadline with a tweaked invoice with their own account details on it.

Sladden says its advice to people was to ring and check the bank account number with the law firm or real estate agent.

"If it is an account you have never paid money to before. Check with the lawyer and read out the account."

Sladden said it paid to verify the bank account details for any large transaction as once a mistake was made it was difficult to recover funds.

"Once it gets into a fraudster's account the chances of recovery are very slim," she said.

The invoice scam is just one of the many types the ombudsman service has seen in the past year which has contributed to a 37 per cent rise in scam cases in the year to June 30.

Sladden described the increase as a significant step up and said the scams were getting more sophisticated.

"Scams and fraud are on the rise and costing New Zealanders millions as well as the heartache of being a victim of fraud."

She said it talked to victims on a daily basis who were too stressed and embarrassed to tell their families about their situation.

"Others don't even want to give us their names."

Sladden said a new breed of scammers were emerging who were masters in manipulating people by tapping into their emotions.

"They use fear to their advantage. Scammers says things like - you've done something to your computer and people are hacking into it. Someone has downloaded a game using your wifi and now your system has a virus. You owe money to Inland Revenue.

"Scammers are now far more creative in finding new ways to engage and groom their victims."

Sladden said accessing your banking details doesn't come until much later, often hours down the track.

"But the end game is the same – by distracting you with terrible news, scammers quickly move on to how they can help 'fix things', gambling on the fact you won't stop to check anything until it's too late."

Sladden said the distraction may also come in the form of good news.

"You've won a prize. You've been selected for a holiday. I've seen your profile online and I want to get in touch, but my subscription is about to end – email me!"

She said its advice to people was stop and check before clicking on a link or accepting 'help' over the phone.

SCAM ADVICE
• Think twice when you're unexpectedly contacted – even if the person says they're from a legitimate organisation like the bank or your internet provider.

• Don't respond to phone calls or contact about your computer asking for remote access to fix it. No one is going to contact you out of the blue about a problem with your computer.

• Legitimate organisations will never ask you for your passwords. Use good, strong passwords on online accounts – and don't tell anyone what they are.

•Keep your personal information secure. Think carefully before entering your details online, or giving them to someone.

•If you're using an online trading or booking website or app, don't communicate or pay outside of the website or app.

•If someone offers you money or another offer, but you have to make a payment up front, ignore it. This is a common tactic of scammers.

• Don't give money to people you have entered into a relationship or friendship with online.

• Use a good anti virus and keep your software up to date. This will help to protect your device from someone trying to access it.

• Be wary of unusual payment requests. Scammers try to use payments that can't be traced such as pre-loaded debit cards, gift cards that can be used online, iTunes cards or money transfer systems.

Source: Netsafe.