Peterborough, NH Loses $ 2.3 Million to Cybercriminals
This story will be updated as more information becomes available.
The city of Peterborough has announced that it has been the victim of a $ 2.3 million scam by cyber thieves. A press release issued by chosen board chairman Tyler Ward and city administrator Nicole MacStay said it was not clear whether the insurance would cover losses and that it was impossible to cancel transactions.
The City of Peterborough’s budget for this fiscal year is just over $ 15.8 million.
“It’s very shocking for us to be completely honest,” MacStay said in a telephone interview on Tuesday. “It has been very difficult to get over all of this and try to do our best to recover these funds … to lessen the burden on our residents and taxpayers.
City officials say the theft came in two parts. First, the thieves posed as local school district staff, using forged documents and email accounts to gain access to a million dollar transfer from the city to the district.
The city says it then informed the U.S. Secret Service and a cybersecurity consulting firm through its liability coverage.
Several weeks later, thieves used the same approach to steal a payment intended for contractors working on the Main Street Bridge project.
“Investigations into these bogus email exchanges show that they are from overseas,” the press release said.
“These criminals were very sophisticated and took advantage of the transparent nature of the public sector’s work to identify the most valuable transactions and focus their actions on the hijacking of those transfers.”
“We have money to cover our transactions, so we won’t be withholding payments at this time, but we are really waiting for the insurance to come back and tell us if these losses will be covered,” MacStay said.
City officials have contacted the governor’s office and the New Hampshire legislative delegation. Peterborough has canceled all automated clearinghouse transfers, and MacStay said the city is reviewing all city policies and procedures related to electronic transfers.
“We’re doing our best to make sure we haven’t left any stone unturned,” she said, “that we’ve looked for every hole and every vulnerability and try to fix it as best we can.”
Finance ministry staff who were directly targeted are not believed to be criminally implicated in the transfers, but are on leave until the Secret Service investigation is completed.
Update: August 23, 2021 at 5:47 p.m. EDT
This story has been updated to include quotes from an interview with the City of Peterborough Administrator.