City of Saskatoon loses $1 million to fraudster posing as executive Tank: Scam stings at Saskatoon city hall with shiny fiscal reputation City of Saskatoon staff say $40,000 of the $1.04 million lost through an online fraud scheme has been recovered, while the majority of the funds have been legally “locked down.”City manager Jeff Jorgenson provided additional details about the fraud and recovery efforts in an interview on Monday. He did not specify how much of the remaining $1 million scattered among “multiple” bank accounts is under lockdown, or the country of origin of the accounts, but said the focus right now is on efforts to recover the money. The city hired an Ontario-based law firm to work with Canadian banks and issue court orders where most of the big banks are based.“What I can say is the vast majority of the money has been traced and legally frozen,” Jorgenson said. He was advised not to disclose how much of it was traced by both the internal and Ontario legal teams, in part because the amount is changing “hour by hour” as the banks find more money, he said.The money that has been located so far is in 10 to 15 accounts, Jorgenson said. After the money is frozen through the court orders, the individual bank account holders have to be informed they have the proceeds of fraud and to return the money. Jorgenson said some of the money will be returned voluntarily.“There’s a chance that some might contest it, and we basically just go through the legal proceedings to do everything we can to get the money back,” he said.Story continues belowThis advertisement has not loaded yet,but your article continues below.He thinks there’s a possibility some of the money has been spent, since not all of it has been frozen, he added.The fraud was the first of its kind the City of Saskatoon has faced. Jorgenson said the fraud came to light on Aug. 12 after it became clear to the rightful receiver, Allan Construction, that the funds weren’t going to show up in its bank account. The payment was specifically related to the Sen. Sid Buckwold Bridge rehabilitation project, he said.The city was initially contacted in July by someone impersonating the company’s chief financial officer, Blaine Dubreuil, in an electronic communication, Jorgenson said. On Aug. 7 or 8, the city made the payment to the account provided by the perpetrator. After the fraud was discovered, the city reported it to Saskatoon police.“It’s very disconcerting that the perpetrator used my name and our company name to commit this crime,” Dubreuil said in a statement. “We have done a security assessment and are confident that our systems were not hacked or compromised. We’ll be working closely with the City of Saskatoon and the Saskatoon Police Service as the investigation continues.”The city made a claim to its insurer last week after it uncovered the fraud. Jorgenson said the city also immediately implemented new controls to prevent a similar scenario from repeating in the future. He said the verification controls have been “bolstered,” but declined to describe the past controls that were in place at the time of the breach — such as who processed the change or who signed off on it — since that is now part of the investigation.He said the city also reviewed all changes of bank account information that have occurred within the City of Saskatoon corporate structure over the last few months to ensure there aren’t any other “lingering” potential frauds about to happen.“There were controls in place, but clearly, the controls weren’t adequate to prevent this theft, so I’m not going to say that we were prepared,” he said.The $40,000 that was returned to the city was returned by the first account holder the city dealt with.Jorgenson did not disclose how much it cost to retain the Ontario legal team; he said the cost has yet to be determined, but will be disclosed at the end of the process. He expects to make future updates to the public and to city council, he added.A perpetrator of the scheme — known as “whaling” because it targets higher profile entities than a “phishing” scam — has not been identified, Jorgenson [email protected]

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