Firm Sues Cyber Insurer Over $480K Loss
Summary: Houston-based Ameriforge Group Inc. (AFGlobal Corp.) is suing Federal Insurance Co., a Chubb Group division, after the insurer denied a claim over a $480,000 wire the company's accounting director sent to a bank in China in May 2014 on instructions from scammers impersonating CEO Gean Stalcup. Chubb denied the claim in an October 9, 2014 letter, arguing the business email compromise did not involve forgery of a financial instrument as the policy required, and the FBI says thieves stole nearly $750 million in such scams from more than 7,000 U.S. victim companies between October 2013 and August 2015.
Key Takeaway: The policy carried up to $3 million in coverage with a $100,000 deductible, yet Chubb's reading of 'financial instrument' as a check or draft left the full $480,000 with the company - and the same insurer was already being sued by Medidata Solutions over a $4.8 million loss from a near-identical fake-CEO wire to a Chinese bank.
Read the original at Krebs on Security ↗
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- Governance, Risk & Compliance
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