Expert Witness Journal Issue 63 October 2025 - Flipbook - Page 99
Cyber insurance and email fraud:
Implications of the Siam Aero decision
by Hans Allnutt & Lara Maslowska
of fraud. Logix then 昀椀led amended particulars of
claim which altered the crux of the claim from one
alleging fraud to one in which Siam was accused of:
Overview
Logix Aero Ireland Ltd v Siam Aero Repair Company
Ltd [2025] EWHC 1283 (KB)
This case concerns the purchase of 2 aircraft engines
by Logix Aero (“Logix”), a company based in Ireland,
from Siam Aero Repair Company (“Siam”), based in
Thailand. The sale was introduced to the defendant
by Corentin Espitalier, the CEO of Sky Aeroservices
SARL (“Sky Aero”), the French company providing
the tear down services for the aircraft from which the
engines were obtained. Representatives of Sky Aero
were copied in to the parties’ email correspondence.
Disclosing con昀椀dential information to the
fraudster in breach of a con昀椀dentiality clause
•
Providing apparent authority to the fraudster
to act on its behalf when it reached the binding
sale and purchase agreement. The apparent
authority was said to arise from the principal
(i.e. Siam) putting the agent (i.e. the fraudster)
in a speci昀椀c position carrying with it “usual
authority”.
The court struck out the claim, 昀椀nding that no
apparent authority could have been given by Siam to
the fraudster to act as its agent and the concept has
no application to circumstances where the parties
believe they are dealing with each other. Further,
even if there had been a breach of the con昀椀dentiality
clause, this was not causative of the loss of purchase
monies. The loss was caused by the communications
from both sides and, primarily, the actions of the
fraudster.
The majority of the negotiations were carried
out via email. As the terms of the sale & purchase
agreement were being discussed, a fraudulent third
party inserted themselves into the conversation
using similar, but incorrect email addresses for the
buyer and purchaser allowing the fraudster to act as
an unseen middleman, controlling the conversation
and stopping the parties to the transaction
communicating with each other. The upshot was
that the buyer, Logix, paid the purchase money to
the fraudster on the basis of doctored invoices and
this was only discovered when Siam complained it
had not received payment.
The court proceeded to award the Siam’s costs on the
indemnity basis thanks to Logix’s initial unjusti昀椀ed
allegations of fraud.
The 昀椀rst access by the fraudster to the negotiation
conversation was following a genuine email from
Siam, but it was con昀椀rmed in forensic reports
from Secretariat (instructed by Siam) and Kroll
(instructed by Logix) that there was no evidence
of either party’s IT systems having been hacked or
otherwise compromised, or that anyone connected
to either party sent the email to the fraudster.
Relevance for victims of email fraud and
cyber insurers
The circumstances of email interception leading
to 昀椀nancial fraud will be very familiar to cyber
insurers who frequently deal with “business email
compromise” incidents, where by hackers obtain
access to an insured’s mailbox. While 昀椀nancial fraud
does not always follow, business email compromised
incidents do frequently appear to have this intention
due to the targeting of accounting mailboxes and
payment emails.
Kroll was not able to review Sky Aero’s email system,
having been informed by Sky Aero that the logs for
the relevant months were missing. Although the
judgment does not explicitly note this observation,
an unanswered question sits over Sky Aero’s emails
as to whether they were hacked.
In circumstances where payment fraud does occur,
a question often arises as to whether liability for the
loss rests with the party whose emails were hacked,
or whether it rests with the payor who ought to carry
out due diligence checks on the recipient banking
details.
Initially Logix sought an interim seizure order
of the engines in France after accusing Siam of
fraudulently pocketing the money. Siam applied to
strike out the claim and provided forensic evidence
from Secretariat debunking Logix’s allegations
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