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Construction firm loses over $500,000 to hackers and blames bank

Sections: Computers, Security

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CybercrimeA Maine construction firm had nearly $600,000 stolen from its bank account and is suing the bank, claiming they are to blame for not monitoring accounts more closely.

Hackers hit Patco Construction Co.’s bank account at Ocean Bank of Delaware (also known as People’s United Bank) in May, ripping off the funds in 6 separate transfers over a week. The account, which was used for payroll, was completely emptied. As part of the account’s overdraft protection the bank took $223,237 from the company’s line of credit to cover the withdrawals.

Patco sued. They blame the bank saying the hacking is their fault and that Ocean did not do enough to monitor for suspicious activity. It is not yet clear how the hackers got into Patco’s account. Several employees had access to it with their own IDs and passwords. It’s likely a malware infected computer is involved, or someone with access fell for a phishing scam. So far, the bank has only been able to recover $243,406.

I’m not so sure the bank is to blame, but I don’t know what kind of security procedures their online banking site has in place. I do know that it was Patco’s responsibility to monitor their account and that giving multiple employees access to it was not smart. The more people who have access the more likely something will go wrong.

Read [PCWorld]

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  • Builder

    Well, times are <a href="slow" rel="nofollow">http://www.thestuccocompany.com/hvac/slow-times-38523-.htm">slow in the construction industry, as many people attest to here. But I don't think they are slow enough to just quit checking your account for a week, no less. The amount of money stolen does hint at the size of the company that probably cannot afford a full time bookkeeper but I cannot imagine the owner not checking the account. Especially in times like this. Anyways, just though something does not add up in this story…

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  • Bank Accounts Advice

    We have had many people concerned with this kind of fraud taking place to their bank accounts, really security measures should far stricter than they are at the moment with some online banks that exist! However if you allow multiple people to access your online accounts you really are asking for problems.

  • Refurbishment Chester

    It's things like this that are putting firms off technology! Why is it this can happen, even though the account would have only paid out money at a specific time each month. But when you try and use your card at an ATM two minutes after spending in a shop it gets refused!