Money taken from municipal account
Township supervisors say $102,000 was illegally transferred. The FDIC warns of a rising trend of electronic thefts.
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BY ELIZABETH GIBSON egibson@patriot-news.com
Money stolen from the bank account of a second government agency in Cumberland County might be the work of a wire-fraud scheme that is being seen nationwide.
Monroe Twp. supervisors confirmed Thursday that $102,000 was illegally transferred from its F&M Trust account and that an additional transfer of $36,000 was under way when authorities locked down the account and halted the transfer.
Discovery of the theft came Oct. 19, just 10 days after the Cumberland County Redevelopment Authority confirmed that a computer hacker stole $479,000 from one of its M&T Bank accounts.
Investigators said Thursday that it was too soon to know whether the thefts were connected.
However, the FDIC has warned banks and other financial institutions of an increase in efforts to "recruit people into fraudulent, work-at-home, fund transfer schemes," said Kenneth Ditzler, senior vice president of marketing and communication for Chambersburg-based F&M Trust.
"They're getting people to act as 'mules,' much like they have mules in the drug trade," Ditzler said.
During the fraud, someone gains access to a bank account and transfers money to numerous 'mule' accounts. Cash in the mule accounts is then quickly transferred to accounts offshore, with the user of the mule account keeping an 8 percent to 10 percent commission, according to the FDIC.
A.W. "Bill" Castle III, chairman of the Monroe Twp. supervisors, said township staff called him in tears when notified of the missing money. He said he couldn't reveal any details because federal and state authorities were still investigating, but he did say the township was contacted about unusual money transfers.
"Some alert people acted promptly and probably saved us a lot of money, not only at our facility but at other facilities," he said.
Castle said there was never a concern about whether township staff were involved in the thefts.
It wasn't clear how many accounts have suffered losses nationwide.
Ditzler said Monroe's account has been the only victim at F&M Trust.
He wouldn't say how Monroe's account was breached, but investigators working on the redevelopment authority case have said the account was tapped by a hacker using a Clampi virus, a so-called banking Trojan horse that gleans account data to get past security fire walls.
The FDIC said in a statement that since banks often make electronically transferred funds immediately available, "funds may be removed and wire-transferred overseas before the fraud is detected."
"We have taken measures to monitor wire transfers in great detail. We're taking every precaution and pain we can that it doesn't happen again," Ditzler said. By Correspondent Sheri Melnick contributed to this report
