Coastal Carolina University said it has changed some of its reimbursement procedures after realizing it was scammed out of about $1 million, although it hopes to recover much of the money.
In a news release Tuesday, the school said it was the victim of two different “phishing” scams that occurred in December. The school said someone claiming to represent a contractor requested a change in that company’s bank account information. Coastal officials said the request appeared to be legitimate — with documents that featured the company’s logo, tax identification numbers and names of company officials. The school says an employee checked the information and made the change.
Coastal realized the theft when the legitimate company reached out 11 days later to note it had not been paid. That transaction involved about $840,000. The school says it’s recovered more than $560,000.
“We want for the community, other organizations and businesses to be aware this occurred so they can shield themselves against this kind of fraud,” college president David DeCenzo said in a statement.
School leaders immediately contacted its bank to stop payment and begin the process of recovering the funds. The college’s Department of Public Safety, State Law Enforcement Division and federal authorities are investigating the accounts. So far, efforts to reverse the transfers have recovered more than $564,000.
“Thanks to quick action and the ‘kill chain’ process initiated by federal authorities, a significant amount of funds are being recovered,” said CCU Department of Public Safety chief David Roper said. The “kill chain” is a tool federal authorities use to freeze funds, following assets bank-to-bank in an attempt to recover the money.
During a review, CCU officials discovered a second incident occurring in the same time frame where $340,000 was paid into a fraudulent account. The school said it has made an immediate change in its procedures so an additional reviewer will also examine any modification requests. The University brought in external auditors to investigate and to review finance control procedures and policies.