VRS Acts Quickly with International Partners to Thwart Bank Fraud
Barry Resnick, founding Partner and Chairman of the LEInternational Board of Directors was at the annual conference of members in New York City.
While at a Friday conference dinner meeting, Barry received a call from a Bank President with whom he had worked for many years. The bank president was anxious and solicited Barry’s assistance to solve one of the bank’s largest client’s problem.
It was time sensitive. The problem was that the bank client’s e-mails had been hacked. As a result of the hack, an e-mail disguised as coming from the CEO to the CFO was generated.
The “CEO” directed the CFO to wire $250,000 (USD) to a bank account in the Czech Republic, on the pretense that it was earnest money toward the acquisition of a Czech company. This was not the case. There was no prospective acquisition, nor did the e-mail come from the CEO. The CFO did NOT verbally verify the e-mail directive with the CEO and wired the $250,000 immediately. Shortly after the wire was sent, the CFO saw the CEO and congratulated him on the prospective purchase. The CEO immediately called the Bank President to relay what had occurred. The Bank President, called Barry, who immediately went into action. At the dinner, sitting next to Barry was an LEInternational colleague from the Czech Republic! A plan was developed wherein the Czech attorney would have his partner in Prague visit the bank that received the wire, as well contact the Prague office of the FBI.
The result was that the recipient Prague bank account was frozen, preventing any withdrawal of the funds. Within 3 months the funds were returned to the Bank’s client.
A number of lessons to be learned-
- Cybersecurity should be a major concern of all businesses.
- Dual verification of all money transfers is a necessity.
- If your email has been hacked, bring in a professional to assist you.
- Sometimes, it is not what you know but WHO you know!
The attorneys of VRS have close relationships with an extensive network of international attorneys, and are ready to quickly resolve legal issues in many countries outside the United States. If you need assistance on such matters, do not hesitate to contact our firm.