June 15, 2016

Fraud targets public entities, one county taken for $38K

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Political entities are the target of the latest scam and at least two school districts and one county have fallen prey, costing nearly $40,000 in public funds.

Bag o CashThe State Auditor announced the latest fraud, where employees receive an email from their boss saying they need emergency money wired. The money is then wired to a bank account run by the scammers.

The State Auditor’s office issued a risk advisory, embedded below, to public entities around the state after at least three agencies saw themselves scammed.

The State Auditor’s office said Zuni Public Schools, Deming Public Schools and San Miguel County all started wire transfers based on the fraudulent emails.

The two school districts were able to stop the wire transfers from going through, though San Miguel County was not.

San Miguel County lost $38,000 because of the scam.

“Most folks are familiar with various types of personal email financial scams and unfortunately the tactic is spreading to prey on government employees who may feel intimidated by an email that appears to be from their boss,” State Auditor Tim Keller said in a statement. “We’re reminding folks to stick to normal procedures regardless of the situation. One key to safeguarding public funds is to maintain a ‘tone at the top’ that helps staff feel comfortable asking questions about unusual orders from up the chain.”

The office highlighted some red flags, which include an “out-of-state payee,” “poor or non-standard English” and a “sense of urgency.”

The State Auditor’s office says a “critical” defense against the scam includes “adherence to internal controls regardless of the situation.”

  Risk Advisory-wire Transfers 6-14-16