Nassau legislators call for probe in phishing scam that hit comptroller’s office

Robert Pelaez

Nassau County Finance Committee Chairman Howard Kopel has asked the offices of state Comptroller Thomas DiNapoli and county Inspector General Jodi Franzese to further investigate  the security control measures of county Comptroller Jack Schnirman and his office.

Kopel, a Republican who is the legislator for Nassau’s 7th District and deputy presiding officer, sent a letter to DiNapoli and Franzese Friday morning outlining an incident in which Schnirman’s office fell victim to a phishing scheme online.  

As a result, the county transferred $710,000 to a fraudulent entity before the Nassau County Police Department stepped in and recovered all of the funds in October.

“We’ve taken an unprecedented step and requested, in order to safeguard taxpayer money, that the New York state comptroller intervene, come over here, look at the operations at the Nassau County comptroller’s office,” Kopel said during a Friday news conference.

According to Nassau County Police Commissioner Patrick Ryder, the transfer of payments to the fraudulent account was conducted via email, which Schnirman confirmed.  Ryder said the scammers were impersonating a county vendor and filled out the usual paperwork and documentation to receive the funds.

“Many times we talk about the scams on our elderly, how they can get fooled, but government can become a victim too,” Ryder said. “If it weren’t for the coordinated effort and initial contact from the comptroller’s office, the money may not have been recovered because it moves quickly.”

Members of the bipartisan Finance Committee held a hearing last Wednesday to explore financial and payment security in Schnirman’s office. The members came away with several findings that they described as “troubling” in a news release.

During the hearing, county officials said they believed that the phishing scam only came to light because it was flagged as potentially fraudulent by the county’s bank, rather than an internal system put in place by Schnirman’s office.

Brett Speilberg, a spokesman for Schnirman’s office, identified the bank as a security system installed by the county and provided a statement from Schnirman after the hearing and news conference.

“The Comptroller’s Office was praised by law enforcement for the coordinated effort that resulted in zero dollars being lost,” Schnirman, a Democrat, said. “From day one, the Comptroller’s Office has improved financial controls in Nassau County. We continue to enhance those controls and look to partner with leaders and experts to stay ahead of this threat.”

In his letter to DiNapoli, Kopel requested that a formal audit of Schnirman’s office be conducted and for Franzese to investigate if instances such as this one have happened in the past or could happen in the future.

“I join my colleagues in the Majority in calling upon State Comptroller DiNapoli to conduct a formal audit of the financial and payment security and controls within the Office of the Nassau County Comptroller and to mandate implementation of such changes as will protect taxpayer dollars,” Kopel said. “We also request that the Nassau County Inspector General exercise her authority to conduct an independent review of the phishing scam on the office of the Nassau County Comptroller.”

Speilberg noted that various locations in the county have seen similar attacks, including  the Rockville Centre school district, which had to pay $100,000 to restore its data after a ransomware virus infiltrated its system in August.

Schnirman noted that other areas on the island were targeted as part of this phishing scam and that the issue of protecting sensitive information and finances should not come down to politics.

“In this incident alone, 3 to 4 other municipalities on Long Island were also targeted,” Schnirman said. “Instead of cynically playing politics with public safety, I encourage the Republican Caucus to join me in working towards proactive solutions to protect taxpayers.”

Efforts to reach the offices of the state comptroller and inspector general were unavailing.

 

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