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Hackers empty $900K bank account

By Claes Bell, CFA · Bankrate.com
Monday, February 25, 2013
Posted: 9 am ET

In itself, a distributed denial of service, or DDoS, attack on a bank's website is little more than costly hooliganism. It essentially consists of hackers ordering a bunch of malware-infected computers to "click" on a bank's website until it's too overwhelmed to respond to legitimate users.

The effect is pretty similar to a barricade across the entrance to your bank: You can't get in, but your money is still safe inside the bank.

But what if thieves used a DDoS attack as cover for a more harmful attack that did actually compromise customer checking accounts? That appears to be exactly what happened to a customer of Bank of the West, according to a report from security blogger Brian Krebs:

A Christmas Eve cyber-attack against the website of a regional California financial institution helped to distract bank officials from an online account takeover against one of its clients, netting thieves more than $900,000.

At approximately midday on Dec. 24, 2012, organized cyber crooks began moving money out of corporate accounts belonging to Ascent Builders, a construction firm based in Sacramento, Calif. In short order, the company's financial institution -- San Francisco-based Bank of the West -- came under a large distributed denial of service (DDoS) attack …

There were 62 individuals suckered in to acting as "mules" for the stolen money, according to Krebs.

It's standard operating procedure for scammers to recruit unsuspecting individuals and businesses ("make big money working from home!") to accept a substantial deposit from thieves and wire the bulk of it overseas, keeping a portion for themselves as payments. Typically, the money clears and the mule completes the transfer, only to have the authorities catch up with them and claw back the money, leaving them on the hook for most of the losses.

Obviously, you never want to agree to accept and transfer cash as these mules did. Aside from the legal implications of engaging in what amounts to money laundering, what good are promised payoffs if they're going to be clawed back later?

Another important step to avoid having your account on the receiving end of this type of coordinated attack is having up-to-date antivirus software installed on your computer. Krebs writes that the thieves may have gained access to Ascent Builders' bank logins using malware surreptitiously installed on its computers. And you don't want that happen to you, especially on Christmas Eve.

What do you think? Do you worry about online thieves draining your accounts? What precautions do you take to prevent that from happening?

Follow me on Twitter: @claesbell.

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147 Comments
Gunny
April 04, 2013 at 7:20 pm

@Btetley- ever heard of the bridge to nowhere? Who was responsible for that again?

The Grox
April 04, 2013 at 6:24 pm

This is no different than what Cyprus is doing to it's bank users.

Stephen
April 03, 2013 at 7:45 pm

The old fire insurance scam at work again! There is no hacking, just convenient scapegoating.

Bob
April 03, 2013 at 4:32 pm

Frank Burns eats worms.

Btetley
April 03, 2013 at 11:05 am

How is this scam ANy different than Democrats taking more of OUR money to spend on THEIR pet projects that only help THEM get re-elected.

DJ
April 02, 2013 at 10:01 am

Seems like there is no agency protecting the average citizen anymore. Time for some vigilantes?

Linda
April 02, 2013 at 9:26 am

This type of scam is also being worked through E-Bay. You purchase something from an e-bay vendor. Sometime later they e-mail you and tell you that they have to go out of town for a month for a family emergency and they have a business deal for you - you will make $1000 a month to accept money into your checking account and within a 4 hour window, you withdraw the money less your commission and send it to a party via Western Union. They can't send it themselves because they're located in a country without such facilities or that the merchandise comes from another country and the people here in the USA prefer to do business with other Americans. I reported this to E-bay, my bank who reported it to the FBI. Those who accept this type of work will lose their bank accounts and also the ability to have a bank account at any other bank, the IRS will want to know where you got this income since this transaction will be reported to them and you will have to either pay the taxes on this money or you will be arrested.

DanB
April 02, 2013 at 3:03 am

It's so easy for criminals to drain bank accounts and create false IDs. The banks are not too concerned about fixing the security problem - it's not their money that's being stolen. The innocent customer is stuck with fixing the problem.

AMDEMUSA
April 01, 2013 at 12:03 am

Sheikh Hasina's Digital Technology is working.

DavidPL
March 29, 2013 at 5:54 pm

Do not deposit scammer checks in your checking account. It is possible that the scammer can get your checking accout number and then empty your checking account. Playing with these people can get you burned. You can't know all their angles, and they are creating new scams all the time.