EDITORIALS NBT Bank should repay school’s stolen funds
There oughtta be a law so that when a bank loses a depositor’s money due to fraud, the depositor isn’t left holding the bag. Wait, there is a law, but it only protects individuals, not commercial customers . And so the Duanesburg Central School District may have to sue NBT Bank, which lost $497,000 of the district’s deposits to computer hackers, in an attempt to recover its money. Well, sue it absolutely should because it certainly wasn’t to blame in December when $3.8 million of its money got wired overseas, to a place where U.S. regulators have no reciprocity. While NBT was able to recover most of the money, the amount it’s still short would represent a big hit to a small district like Duanesburg. But in a budget year in which the district faces a $787,000 reduction in state aid and a $748,000 increase in nondiscretionary expenses, the hit would hurt even more. NBT doesn’t think it did anything wrong, but a system that allows hundreds of thousands of dollars of a local school district’s money to be wired overseas, without alarms going off, seems flawed. Indeed, alarms eventually did go off — but not before it was too late to avoid the loss of a half-million dollars. ..............>>>>..............>>>>.............http://www.dailygazette.net/De.....r00702&AppName=1
Did somebody at the Gazette not get their big boy (or girl) dictionaries out when writing this? Or is this a new style of writing in talk lingo? Did they not get the newest updated version of Word to let them know with that little squiggly line that "oughtta" isn't a word? From a resident, I might expect something like this, but it would also be part of the opinion that the Gazette would make sure they rewrote before they printed it, with their artistic license.
Sorry, but for some reason, this got under my skin and I just had to let it out.
I do hope that Duanesburg sues and gets their money back along with damages.
DUANESBURG District eyes legal action in theft of funds BY JUSTIN MASON Gazette Reporter
Duanesburg Central School District offi cials have upgraded their insurance policy, hired a new bank and continue to explore legal options, but don’t appear any closer to recouping $497,000 stolen by hackers late last year. Superintendent Christine Crowley said the district recently interviewed a number of law firms in an effort to determine how to proceed. But she said there’s still no clear path to recover the money stolen from its account with NBT Bank over the course of five days in December. “It’s still up in the air,” she said last week. “The bottom line is we want to know if anyone is responsible for the theft of the money.” Hackers attempted to transfer an estimated $3.8 million from the district’s account to destinations overseas. The bank was able to reverse most of the transfers immediately, but were unsuccessful in returning the full balance of the stolen funds. Federal investigators still haven’t recovered the remainder of the pilfered funds or made any arrests in the case. And Crowley said they’ve been less than forthcoming with any information about the progress of their probe into the theft. ........................>>>>...............>>>>...................http://www.dailygazette.net/De.....r01002&AppName=1
EDITORIALS Change bank law, help Duanesburg schools recover stolen funds
More than seven months have passed since the Duanesburg Central School District’s bank account was emptied out by computer hackers. All but $497,000 of the $3.8 million stolen was quickly recovered, but that sum got wired overseas to a place the United States has no reciprocity, and as a story in Wednesday’s Gazette revealed, both the school district’s bank and insurance carrier refuse to make good on the loss. A loophole in federal banking law appears to support their position — weasly though it may be — so district taxpayers will likely get stuck holding the bag. What an outrage! It seems unbelievable that the district, through no fault of its own, is out such a substantial amount of money while the entity that last had control over it — NBT Bank — is allowed to walk away. The district is considering legal action against the bank, from which it has subsequently severed its ties, but recovery of the funds is by no means a foregone conclusion. The federal investigation into what happened has thus far failed to produce any results, and no arrests have been made. .............>>>>..............>>>>.......................http://www.dailygazette.net/De.....r00702&AppName=1
Duanesburg school district appreciates the support on lost funds
Thank you for the excellent July 7 article, “District eyes legal action in theft of funds,” and subsequent July 10 editorial, “Change bank law, help Duanesburg schools recover stolen funds.” We, too, are outraged that the taxpayers of the Duanesburg Central School District are expected to foot the bill for the stolen $497,000 which was the result of a cyber-crime attack on the school’s bank account. While NBT Bank was able to recover most of the more than $3 million of unauthorized electronic wire transfers to foreign countries, it has so far declined our requests to restore the funds they were unable to recover. Its letter to the school district states, “The Bank has considered your request and believes that it would be irresponsible to make a payment at this time without the investigation having been concluded and a determination being made that the Bank is culpable.”. A loss of $497,000 is very signifi cant for a small school like Duanesburg Central School and especially harsh when we can expect to see budget cutbacks from the state in the future. Even if the school sues NBT Bank and wins in court, only a portion of those funds can be recovered since legal fees cannot be included in a lawsuit. We are very grateful that Sen. Chuck Schumer and his staff are working on a possible resolution and are encouraged by the statement attributed to his offi ce: “The current regulations weren’t meant to put schools at a disadvantage when dealing with cybercrime, and we are looking at potentially amending the law to treat schools and municipalities as individuals.” As noted in your article, individual accounts are protected from fraud by the bank, commercial accounts are not. We agree that the loophole that allows banks to put this risk completely on commercial customers needs to change. Any change in the law, however, should be made retroactive to cover losses such as ours. We encourage others to contact Sen. Charles Schumer on this issue. You can write to him at his Albany address: Leo O’Brien Bldg., Room 420, Albany, New York 12207, [or call] 431-4070. CHRISTINE CROWLEY Duanesburg The writer is the superintendent and the letter was endorsed by the Duanesburg School Board of Education.
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