Feeds

Florida man sues bank over $90K wire fraud

Why didn't you warn me about Trojans!

  • alert
  • submit to reddit

Secure remote control for conventional and virtual desktops

A Miami businessman is suing his bank after $90,000 was lifted from his firm's online banking account following a computer virus attack. Joe Lopez, 42, filed suit against the Bank of America in Miami Circuit Court last week alleging that the bank was negligent in failing to protect his account from compromise through known risks, the South Florida Sun-Sentinel reports.

The case is thought to be the first time a customer has sued a bank over cybercrime losses in the US. It will test the balance of responsibilities between banks and their users over ensuring the security of online banking transactions.

Lopez runs a small printer ink and toner business in Miami. He regularly uses wire transfers both to send and receive money from business contacts in the US and Latin America.

But on 6 April he discovered an unauthorised wire transfer of $90,348 to the Parex Bank in Riga, Latvia. Around $20,000 was withdrawn before the account involved was frozen. The remaining $70,000 remains at Parex Bank. Lopez reported the unauthorised transfer to the police. The US Secret Service became involved in the investigation, which featured a forensic examination of PCs used by Lopez and his businesss, Ahlo Inc, that uncovered infection by a Trojan called Coreflood.

Coreflood is primarily designed to conduct Denial of Service (DoS) attacks, but the theory is that the backdoor access it enabled criminals to extract banking passwords and account details entered into Lopez's PC. This remains unproven.

Lopez's legal case is that Bank of America knew of the risk posed by the Coreflood Trojan but failed to inform customers. There's also the question of whether Bank of America was diligent in so easily allowing the transfer of a large sum to a known centre of cybercrime. Lopez alleges breach of contract, negligence and intentional misrepresentation by Bank of America in a suit aiming to recover his money, plus interest and legal fees. Bank of America has ruled out any breach of its e-banking systems. It denies any responsibility over its customer's losses.

Lopez has taken a second mortgage of his home to keep his business afloat. His attempt to recover his funds from Riga is caught in a tangle of legal and bureaucratic red tape. Lopez's lawyer, Ralph Patino, hopes the suit will attain class action status, allowing more fraud victims to sue their banks over cybercrime losses.

Lopez has stopped using wire transfers. ®

Related stories

Trojan targets UK online bank accounts
UK banks launch anti-phishing website
SA police arrest man in Absa Net bank fraud case
Fraudsters recruit phishing middlemen
Phishing losses overestimated - survey

Gartner critical capabilities for enterprise endpoint backup

More from The Register

next story
Microsoft exits climate denier lobby group
ALEC will have to do without Redmond, it seems
Caught red-handed: UK cops, PCSOs, specials behaving badly… on social media
No Mr Fuzz, don't ask a crime victim to be your pal on Facebook
Barnes & Noble: Swallow a Samsung Nook tablet, please ... pretty please
Novelslab finally on sale with ($199 - $20) price tag
Ballmer leaves Microsoft board to spend more time with his b-balls
From Clippy to Clippers: Hi, I see you're running an NBA team now ...
Kate Bush: Don't make me HAVE CONTACT with your iPHONE
Can't face sea of wobbling fondle implements. What happened to lighters, eh?
Video of US journalist 'beheading' pulled from social media
Yanked footage featured British-accented attacker and US journo James Foley
Amazon takes swipe at PayPal, Square with card reader for mobes
Etailer plans to undercut rivals with low transaction fee offer
Assange™: Hey world, I'M STILL HERE, ignore that Snowden guy
Press conference: ME ME ME ME ME ME ME (cont'd pg 94)
Call of Duty daddy considers launching own movie studio
Activision Blizzard might like quality control of a CoD film
prev story

Whitepapers

Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
7 Elements of Radically Simple OS Migration
Avoid the typical headaches of OS migration during your next project by learning about 7 elements of radically simple OS migration.
BYOD's dark side: Data protection
An endpoint data protection solution that adds value to the user and the organization so it can protect itself from data loss as well as leverage corporate data.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?