City of Fresno Lost $400,000 to African Email Scam

The City of Fresno, in California’s Central Valley, reportedly lost $400,000 to an email phishing scam based in Africa in 2020 and did not tell the city council or the public, according to investigative reporting by the Fresno Bee.

The Bee reported Wednesday:

The city of Fresno lost about $400,000 in 2020 after falling victim to an electronic phishing scam, and former Mayor Lee Brand’s administration failed to disclose the loss to the Fresno City Council and taxpayers, The Fresno Bee has confirmed.

Furthermore, the Fresno City Attorney’s Office in December 2021 rejected a public records request from The Fresno Bee seeking city communications regarding the fraud. The city told The Bee no records were located. However, The Bee recently obtained emails that existed prior to the records request.

The electronic fraud was disguised as an invoice from a subcontractor working on the construction of the new southeast Fresno police station, Councilmember Miguel Arias told The Bee. The invoice included the subcontractor’s letterhead, and only the account numbers were different. A city staffer completed an electronic money transfer, not knowing the invoice was a fake, he said.

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Online fraud has evolved from the Nigerian prince scam to become more elaborate. In 2020, vendor email compromise (VEC) was predicted to become the No. 1 electronic attack type. In a typical vendor email attack, scammers create fake invoices that look exactly like a real vendor’s, but they change the bank account information so that when a payment is issued, the money ends up in the scammer’s account.

Scams are an increasing problem for both the private and public sectors. Americans were reported to have lost nearly $30 billion to scams in 2021, and the U.S. government is thought to have lost some $100 billion in pandemic relief funds to fraud. Phishing scams targeting state and local governments were reported to have grown “fivefold” in the three years leading up to 2019.

Joel B. Pollak is Senior Editor-at-Large at Breitbart News and the host of Breitbart News Sunday on Sirius XM Patriot on Sunday evenings from 7 p.m. to 10 p.m. ET (4 p.m. to 7 p.m. PT). He is the author of the recent e-book, Neither Free nor Fair: The 2020 U.S. Presidential Election. His recent book, RED NOVEMBER, tells the story of the 2020 Democratic presidential primary from a conservative perspective. He is a winner of the 2018 Robert Novak Journalism Alumni Fellowship. Follow him on Twitter at @joelpollak.