Construction Firm Patco Construction Company
Sues After $588,000 Online Theft
September 24, IDG News Service – (Maine)
A construction company in Maine is suing its bank after about $588,000 disappeared from its accounts, alleging the bank failed to spot suspicious account activity before it was too late. Over a week-long period in May, fraudsters made six transfers from the online bank accounts of Patco Construction Company, a family-owned developer in Sanford, Maine, according a copy of the lawsuit on the WashingtonPost’s Web site. The money went to so-called “mules,” or people who have agreed to receive the funds and then further transfer it to the fraudsters. The hefty withdrawals exceeded the amount of money Patco had in its account, which was used solely for payroll. To make matters worse for Patco, its bank — People’s United Bank, or Ocean Bank of Delaware — drew $223,237 on the company’s line of credit to cover the withdrawals. Ocean Bank now wants Patco to pay that money back with interest, the lawsuit said. After the bad transfer came to light, Ocean Bank did recover or block $243,406, but Patco is still on the hook for $345,444. The fraudsters had a lot of key information needed to do the transfers, conducted through the ACH (Automated Clearing House) Network, used by institutions to handle direct deposits, checks, bill payments and cash transfers between businesses and individuals.