Police Still Investigating City Account Breach

The San Marino Police Department continues its investigation into the apparent breach of the city’s general fund checking account in December.
In the meantime, Citizens Business Bank has refunded the nearly $3,000 that was fraudulently stolen through several transactions and the city has implemented safeguards moving forward.
“They were amazing,” said Josh Betta, interim administrative services director for San Marino. “We’ve implemented since that time a positive pay system for all ACH (automated clearing house) transactions.”
Essentially, Betta explained, the city now includes a list of authorized accounts to receive deposits from its account and the bank would simply reject any attempt to transfer money to an account not on the list.
“Every time we run a batch of checks through accounts payable, there’s a file we create and send to the bank,” he said. “We’ve implemented ACH protections at the electronic level.”
There were five fraudulent transactions made using the checking account on Dec. 11, all of which were reported to SMPD the next day after a city accountant and contract accountant discovered them. A sixth fraudulent transaction was made on Dec. 13.
Two of those transactions were used to make payments to the same Capital One credit card account, and the other four were used for varying financial account vendors.
Detective Brian Wong with SMPD, who is handling this investigation, said last week he may have pictures of a suspect. He said he acquired those images from the surveillance cameras of stores at which the Capital One credit card had been used.
“Through that, I was able to ascertain some account information,” Wong said. “I believe the account was fraudulently created to begin with. I do have some images of potential suspects and am expecting some more to come in.
“Whoever’s using this card, the fact that the majority of the transactions are in the Pasadena, it’s likely that they’re local,” he added, saying they were all typical retails purchases.
Wong, who generally handles white collar crimes for SMPD, said it was important that the city discovered and reported the fraudulent activity quickly because there is a time-sensitive nature to tracking down fraudsters and identity thieves.
“That’s in order to preserve any evidence that may dissipate, especially video,” Wong explained. “Usually records will last a while, but a lot of time video is not retained very long. For that reason, that’s something that has to be looked at quickly.”
Wong said he considered it “unusual” that a public checking account would be targeted and suspects it was not done deliberately.
“I think perhaps the (account) numbers were obtained somehow with no regard as to whom the account belongs,” he explained. “I couldn’t imagine someone specifically doing that because it’s pretty risky, but I can’t discount that either.”

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