Frederick City Says It’s Recovered From Phishing, Wire Fraud Attack

It says it has managed to recover the $380,000  lost due the attack.

William Donald Schaefer Building

Frederick, Md (KM) The City of Frederick says it has recovered from a Phishing and wire fraud attack in November, 2023 related to the retro-fitting of the William Donald Schaefer Building into a police department headquarters. In a statement, officials says the phishing e-mail scheme was conducted by unidentified perpetrators posing as a legitimate city vendor.

The fraudulent wire transfer cost the city $280,000, but it was able to recover those funds through its insurance provider, minus a $50,000 insurance deductible.

The Maryland State Police continue to investigate this incident. Because of the ongoing investigation, and to protect against future phishing attacks, the City of Frederick says it will not disclose any details regarding the tactics used by the attackers, or the identify of  the impersonated vendor.

“It is disheartening to witness bad actors exploit the trust and professional relationship between the city and its vendors for fraudulent purposes, but this incident speaks to why it’s important for the City to maintain multiple, varied lines of insurance,” says Mayor Michael O’Connor, in a statement.

The city says its network security was never compromised during the attack, and efforts to protect it  against similar cyber threats have been ongoing prior to this incident.  It also says it provides ongoing  training to  employees  against phishing attacks. Along with that, officials say the city uses cyber security best practices such as filtering protection and multi-layer authentication  processes.

As a result of this attack, the city says it has implemented a new layer of vendor verification.

The new Police Department headquarters was not impacted by this phishing and wire fraud attack, according  to city officials,  and the new facility is expected to open in the spring, 2025.

By Kevin McManus