Security News > 2020 > January > FBI Investigating How Town Defrauded of $1 Million: Report

The FBI and local police are investigating how scammers posing as a contractor for a local bridge project tricked officials in a small Colorado town into electronically transferring over $1 million to a fraudulent account, according to the Denver Post.

A Dec. 30 internal email sent by Malcolm Fleming, the town administrator for Erie, says that it appears the scam started when a fraudster completed an electronic form posted on the town's website requesting a change in how SEMA Construction, the primary contractor for a local bridge project, would receive payment for its work, according to the Post.

On Oct. 25, Erie officials sent two payments totalling more than $1 million to a fraudulent account not connected to SEMA Construction, the Post reports.

The Post report notes that town staff involved in the wire transfer were not part of the scheme, but at least one Erie worker resigned because of the incident.

The Fleming email also notes that the town is working with its insurance providers to determine if Erie can recoup the lost $1 million, the newspaper reports.

News URL

https://www.inforisktoday.com/fbi-investigating-how-town-defrauded-1-million-report-a-13580