Brighton council pleased with city fraud response

Email spoofing led to $348,000 payment sent to wrong account

Scott Taylor
staylor@coloradocommunitymedia.com
Posted 4/12/21

City Councilors had praise for Brighton City staff and their bankers for sniffing out a fraudulent payment that could have cost the city $348,000. “The transfer went out and within 24 hours we were …

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Brighton council pleased with city fraud response

Email spoofing led to $348,000 payment sent to wrong account

Posted

City Councilors had praise for Brighton City staff and their bankers for sniffing out a fraudulent payment that could have cost the city $348,000.

“The transfer went out and within 24 hours we were notified that there was an issue,” Councilor Adam Cushing said. “Our city manager contacted us late at night to inform us immediately and the very next day a press release went out to the public. It sure looked to me like our staff and manager jumped immediately into action to make sure something like this does not happen again. It seems like she figured out pretty quickly that we dodged a bullet and we’re not going to let this happen again.”

City Manager Jane Bais DiSessa updated the City Council on the potential fraud at their April 6 meeting.

Bais DiSessa said the city had issued an electronic check earlier in the day on March 29 but was notified by the bank that there was suspicious activity involving the transaction. It was halted the next morning and the money returned to the City, she said.

“We believe this was a consequence of cyber-crime and social engineering,” Bais DiSessa said. “As many of you know, cyber-crime Intruders continue to be a significant threat faced by organizations big and small, public and private. This is an example of what we refer as a business email scam.”

Bais DiSessa said it appears that a Brighton staff member was given incorrect banking information for a $348,000 payment to a contractor working with the city on a construction project approved last December.

“We find that a someone has impersonated a legitimate employee of another business and has compromised a legitimate email account to redirect a payment,” she said.

Brighton Police Commander Frank Acosta said investigators have taken all computers involved in the fraudulent payment and put them aside for inspection. The city is working with the Federal Bureau of Investigation on the matter. The investigation will take some time, since it appears to involve money transfers across state lines.

“We will continue to work on this, full speed ahead, but it is going to take time,” Acosta said. “I’m assuming to will take four to six months. The reason is that we will have to go through the court system to obtain search warrants and court orders for IP addresses and things of that nature out-of-state. The FBI is willing to help, although I don’t know how involved they will since we didn’t actually lose money.”

Councilors said staff responded quickly.

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