Hackers used phishing emails to breach into a Virginia bank on two separate intrusions over an eight-month period, making away with more than $2.4 million in total. The bank is now suing its insurance provider for the latter’s refusal to fully cover the losses.
In court documents filed by The National Bank of Blacksburg, details reveal that the bank suffered its first heist in late May 2016 after an employee fell prey to a phishing email. The email enabled intruders to install malware on the victim’s PC and compromise a second computer at the bank connected to the network. This second machine also had access to the STAR Network, a system used by the bank to handle debit card transactions to customers alongside the ability to manage customers’ bank accounts and their use of bank cards.
As KresonSecurity reports, the bank claimed in its filing that hackers were able to disable and tweak anti-theft and anti-fraud protections including customer PINs and daily withdrawal limits. Hackers then used hundreds of ATMs across North America to siphon funds from customer accounts, making away with $569,000 from the incident.
The bank hired a cybersecurity firm to help and a forensic investigation determined that the tools used for the cyber-intrusion appeared to originate from a Russian IP address.
Come January 2017, eight months later, hackers broke into the bank’s systems again via a phishing email and gained access to Navigator, a software used by the bank to manage transactions – credits and debits – to customer accounts. A similar breach ensued, with hackers withdrawing customer funds from hundreds of ATMs.
In its lawsuit, the bank alleges that it had an insurance policy with Everest National Insurance Company with the latter determining that both breaches weren’t covered under an $8 million single loss liability clause and is therefore excluded from coverage.
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