Rock Island County lost $100K+ of taxpayer dollars through fraudulent wire transfers

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UPDATE: Rock Island County Auditor April Palmer responded Friday after noon to the county falling victim to an email scam:

“As the public was made aware this afternoon, an employee of my office was the victim of an email scam which resulted in the inadvertent transfer of over $115,000 to a fraudulent account before it was caught and stopped. The employee was led to believe by receiving a direct deposit request and a bank letter, that the payments were being sent to a long-time vendor of the county’s,” the message says.

“Upon notice of this fraudulent payment, I immediately contacted our Sheriff’s Department and have provided them with all documents and information they have requested. I and my staff, will continue to work with law enforcement until those responsible for this crime are found. As an Elected Officer, I pledge to do everything possible to help recoup these dollars and will continue to update processes to fight the unfortunate ever-growing attacks suffered through on-line and email cyber-crimes,” she said.

“I have already begun to update work processes and talk to other offices about procedures that can be put in place to ensure this never happens again. Additional employee assistance is a huge help through measures such as County-wide training on cybercriminals and more security measures. If the money cannot be recovered then it will be paid out of the Liability Insurance Fund as the County is self-insured for liability incidents,” Palmer said.

“As a lifelong resident and taxpayer of Rock Island County, I take this attack on our assets very seriously. We should not have to endure outside parties taking them for personal gain. I will continue to cooperate, revamp, and maintain the highest standard of internal auditing necessary to keep our money safe! An ongoing internal office investigation is underway, and no disciplinary action has been taken. No county employees have been found guilty of any criminal activity,” she said.

EARLIER: Rock Island County lost more than $100,000 of taxpayer dollars through fraudulent wire transfers, Sheriff Gerry Bustos and the county announced Friday.

“This is a very serious situation, involving a significant amount of taxpayer dollars,” County Board Chairman Richard “Quijas” Brunk said in a prepared statement released to the media. “It clearly represents a concern as to the operations within the auditor’s office.”

The Rock Island County Sheriff’s Office said it opened a criminal investigation into the suspected theft on July 28.

On June 1, the Rock Island County Auditor’s Office was contacted via email requesting all future payments to a company be made through Automated Clearing House because of a change in banking accounts. The email was fraudulent, according to the sheriff’s office.

On June 18, a transaction for $97.042.50 was authorized by the auditor’s office to the suspected fraudulent account via ACH. Another transaction for $18,061.40 was authorized by the auditor’s office to the suspected fraudulent account via ACH on July 23.

From June 18 until July 27, the account was depleted through checks, ATM withdrawals, debit card transactions and online transfers until it was frozen with around $9,000 left on July 28.

“I have formally requested that the County Auditor place the employee involved in this mis-payment on administrative leave,” Brunk wrote, mentioning that a forensic audit will be asked for as well.

An emergency meeting of the board’s Finance and Personnel Committee was held Thursday for a briefing by the sheriff.

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