TOWN OF CHESTER – The FBI recently investigated a cybercrime that resulted in more than $40,000 being stolen from the Town of Chester.
Chester Supervisor Brandon Holdridge confirmed that the feds recently wrapped up their probe into the incident. Town Comptroller Neil Meyer sent an electronic funds transfer (EFT) to what he thought was a legitimate vendor in April. However, a cyber criminal had hacked into the vendor’s account, posing as them, while stealing the funds.
Meyer said that the Town of Chester contacted its bank, local police, and the FBI within 24 hours. According to Meyer, working with the FBI and the bank, the town was able to recover half of the $40,000 quickly. A cyber insurance company will likely cover the other half of the funds, Holdridge said.
Meyer said that the suspected cyber criminal was based in Iceland and was never apprehended by the FBI.
“It is important for every municipality to install proper controls to not only try to prevent fraud but to detect it when it occurs,” Meyer said.
In 2024, cybercrime losses in the U.S. reached $16.6 billion, a 33 percent increase from the previous year. The FBI’s Internet Crime Complaint Center (IC3) received 859,532 complaints, with phishing/spoofing, extortion, and personal data breaches being the most reported types.
David Shapiro, a former FBI special agent and prosecutor in Essex County, N.J., said to prevent cyber attacks, organizations should periodically evaluate “design, implementation, and maintenance of internal controls over the disposition of assets, especially financial resources,” with an independent auditor.
“Proper preventive and detective controls and standards over the risk of fraudulent vendor (EFT) payments exist presently, and these should not be shortchanged,” added Shapiro, MPA-Inspection and Oversight program director at John Jay College of Criminal Justice in New York City. “Efficiency may be the enemy of effectiveness when it comes to safeguarding cash. The adage of pennywise and dollar foolish.”
Holdridge noted that the Town’s audit firm stated last week that Chester’s financial condition is strong with healthy fund balances in all funds. He added that Chester’s Accounting Department has implemented new policies and procedures to increase efficiency and controls to create more accountability and protect the town’s assets.
“The Supervisor and Town Board are extremely proud of what our Accounting Department has done as the safety and security of town assets and financial resources are our top priority,” Holdridge said. “All of this shows the quality work our Comptroller, Deputy Comptroller, and Secretary to the Supervisor are performing every day, as well as proper management from the Town Board.”
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