Thieves stole $400,000 from the City of Mount Vernon through unauthorized bank transactions, moving the money from Mount Vernon’s bank to other banks, but further attempts to steal up to another $800,000 were thwarted by the quick response of the city’s Office of Comptroller and personnel at Chase Bank, Mount Vernon’s Comptroller Darren Morton confirmed to the Business Journal.
Morton told the Business Journal that the Mount Vernon Police Department is handling the investigation from a law enforcement standpoint and likely will be involving the U.S. Secret Service.
“We’re also putting in a complaint to the FBI since that was recommended by the bank as well,” Morton said.
Morton said that his office started receiving an unusual number of emails, apparently from computer hackers using a phishsing scheme to obtain inside information or distract city employees while they broke into the city’s bank accounts.
“There were about 200 emails that flooded us with random content in a matter of minutes, which of course was aimed to try to distract us,” Morton said. “We also got alerts from the bank. It alarmed us to call the bank and see what was happening to try to curtail it before it got worse.”
Morton said that if there were not controls in place the crooks might have succeeded in getting away with the theft of another $800,000 following the $400,000 they had already transferred from the city to their own bank accounts.
“Luckily we had safeguards in place,” Morton said. “We were able to curtail it before it got even worse. The bank was immediately responsive and the Chase Bank Frauds Unit got involved immediately. They reached out to banks that had received the money that was stolen to begin a recovery process. The banks are involved in a ‘best faith’ effort to restore Mount Vernon’s funds.”
Morton said that one of the immediate lessons from what happened is that the city needs to even more regularly review the safeguards and controls built into its systems.
“This kind of effort is becoming increasingly more sophisticated so that requires us to be even more alert,” Morton said. He also urged financial officials in other municipalities and businesses to learn from what happened to Mount Vernon.
“Folks need to know that this is an example of why it’s important to have double and triple safeguards in place,” Morton said. He added that it is important to note that this incident was not an internal matter or the result of any actions by an employee.
“With technology these attacks are constantly evolving,” Morton said. “We have measures in place and were able to respond swiftly. We continue to evaluate and upgrade our security measures and are working with the bank to improve our safeguards.”
