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Cyber Risks · Krebs on Security

Texas Bank Sues Customer Hit by $800,000 Cyber Heist

Summary: PlainsCapital Bank sued its customer Hillary Machinery Inc. on Dec. 31, 2009, asking a federal court in the Eastern District of Texas to certify that its security was reasonable and that it processed wire transfers in good faith, after thieves used Hillary's valid online banking credentials to initiate $801,495 in unauthorized transfers in early November; the bank recovered roughly $600,000. The bank's memo states secure access code e-mails went to a Hillary address from a computer with an Italian IP address and the wire requests came from Romanian addresses, while Hillary says no one received those e-mails and that the credentials and messages were likely intercepted.

What's compelling: The bank is preemptively suing the victim to have its own controls declared reasonable, which puts the question of who absorbs an $801,495 loss - and the roughly $200,000 not recovered - in front of a court rather than in a contract.

Read the original at Krebs on Security ↗

Topics
Data Breaches
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