Burlington Bilked Out of Hundreds of Thousands of Dollars in Online Scam
Published June 13, 2019 at 7:30 pm
The City of Burlington says it has fallen victim to what it calls a “complex phishing scam.”
The city said it discovered it was a victim of fraud on May 23.
The City of Burlington says it has fallen victim to what it calls a “complex phishing scam.”
The city said it discovered it was a victim of fraud on May 23.
According to the city, a single transaction was made to a falsified bank account as a result of a phishing email that was sent to city staff requesting a change in banking information for an established city vendor.
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An electronic transfer of funds of approximately $503,000 was made to the vendor and processed on May 16.
“We are taking this matter very seriously. City staff took immediate action, including notifying members of council and our audit committee when the incident was first discovered. We are working closely with the police on their ongoing criminal investigation and we have also initiated an independent external investigation of the incident which will be part of our reporting back to council and the audit committee,” said Tim Commisso, Interim City Manager, in a statement.
Upon learning of the fraudulent payment, the city says it took immediate steps.
“We reported the unauthorized payment to our financial institution; we notified the Halton Regional Police, and we put in place additional internal controls to prevent this from occurring in the future. Criminal investigations are also underway by the appropriate authorities,” the city said in a statement.
“A full review of our current processes will determine the need for other changes. The city can confirm that our IT system was not compromised during this incident; no personal information was stolen or shared.”
These types of targeted attacks are common and can affect governments, businesses and individuals. In 2018 alone, the Canadian Anti-Fraud Centre (CAFC) received 2,263 reports of business fraud incidents of various kinds, with a total reported loss of $17,501,617.
“This was a case of online fraud with falsified documents at a level of sophistication not typically seen and we are taking the necessary steps to prevent it from happening in the future. This stresses just how important it is that we are all vigilant and recognize the signs of online fraud, phishing and other scams, and report them to the proper authorities — so that no one becomes a victim of this type of criminal activity” said Burlington Mayor Marianne Meed Ward in a statement.
An investigation into the incident is ongoing.
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