With the help of the U.S. Secret Service, Coppell has recovered $631,994.11 of $801,439.03 that was stolen from criminals posing as one of the city’s registered vendors, according to officials.
The money was electronically transferred to fraudulent accounts in June, and officials said the issue involved human error. A city employee made the mistake and did not follow the policy in place in regards to a request to change electronic payments, city officials said.
“Because the employee mistakenly believed they had already spoken with the vendor, the city employee failed to make the required confirmation call to verify if the vendor did in fact request the banking information to be changed,” said Jennifer Miller, director of finance.
Miller said the city realized fraud had taken place after the valid vendor called to question why it hadn’t received payment. The Secret Service filed seizure warrants on the city’s behalf, and Coppell is filing claims to recover the stolen funds.
As for the money that wasn’t recovered, Miller said those funds have already been sent out of the country. She said the funds not recovered will be accounted for as an expense in the city's General Fund.
To prevent another incident like this one, the city is working on revising its current policy and adding additional safeguards to strengthen security.
Miller said this is the first time the city experienced business email compromise (BEC) regarding fraudulent vendors. She cautioned others to be alert.
“Even with all the safeguards that the city had in place, we still became a victim to fraudsters who prey on unsuspecting individuals,” Miller said.