Online Thefts Draw Fast Response From City Hall

Treasurer spots illegal transfers; security tightened

An online thief or group of thieves stole $449,000 from a bank account that belongs to the city of Carson, Calif., last month, likely using a Trojan horse program placed on the city treasurers laptop to gain access to the required username and password.

The thefts, which City Treasurer Karen Avilla spotted when she made her daily online inspections of Carsons bank account balances, prompted officials at City National Bank in Beverly Hills, Calif., to tighten security procedures on Carsons accounts.

Avilla said last week that Carson is now required to register the specific computers that will be used for online transactions at City National. She and other end users must also correctly answer a series of questions in order to gain access to the bank accounts. Meanwhile

, an IT consultant who was brought in to help the city before the thefts is now evaluating its data security protections, she said.

Unauthorized fund transfers were processed on May 23 and May 24, according to Avilla. After she reported the thefts, a computer forensics team at City National examined her city-issued laptop and identified the Trojan horse as the likely entry point for the thefts.

Avilla said she doesnt know how the Trojan horse got onto her system. In her office, her laptop connects to a T1 high-speed line. But when working remotely, Avilla accesses the Internet via wireless connections, which could have enabled the thieves to infect her machine.

The forensics investigators are not sure if it was a random or targeted attack, Avilla said.

She noted that so far, 90% of the stolen money has been frozen by the receiving banks and will be returned to the city. The remaining $45,000 is still being traced by law enforcement authorities.

Copyright © 2007 IDG Communications, Inc.

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