‘No one is immune.’ City continues investigation into theft of $4 million in federal funding
The investigation of the $4 million theft from the city government in Lexington remains ongoing while the city takes preventative measures to prevent future incidents, according to the latest update from the city.
The city said in a press release Monday that internal steps have already been taken, including a review and an in-depth examination of the internal wire transfer processes through the Division of Internal Audit.
“The government is a victim of a crime at a time when it is partnering with agencies across the community to provide critical financial assistance,” Mayor Linda Gorton said. “Cybercrime is a growing problem around the world. We must be sure government employees are well trained to detect it.”
Police are continuing to investigate the incident. The city said it doesn’t believe any of its employees or Community Action Council employees were involved in the theft, but also said new facts continue to emerge.
The city said criminal actors inserted themselves into electronic conversations between the city and Community Action Council. City employees received an email with new bank information from a sender believed to be a Community Action Council employee, but instead it was a scammer
The city sent three wire transfers totaling about $4 million to the bank address before later realizing it was fake.
“This kind of theft is all too common everywhere. It happens all the time to businesses, universities, non-profits, governments … no one is immune,” said Sgt. Brad Williams, who leads the police department’s Financial Crimes Unit. “It is officially called a business email compromise scam.”
The private bank account was immediately frozen, according to Erin Hensley, Commissioner of Finance. Wire transfers of cash to CAC have been suspended until the investigation is complete, the city said.
