Insight & Analysis

Press release: New York Fed to help Bangladesh Bank in US$81m cybercrime suit

Published: Feb 2019

4th February 2019 – The New York Federal Reserve is to assist Bangladesh Bank in a legal challenge to recoup $81 million stolen in a massive cyber heist in 2016.

The hackers tried to transfer around $1 billion from Bangladesh Bank’s account with the NY Fed over the interbank Swift network. The central bank was allegedely vulnerable to the malware intrusion because it did not have a firewall and used second-hand, $10 routers to network computers connected to Swift.

Eighty-one million dollars in fraudulent payments ended up in an account at Philippines-based Rizal Commercial Banking Corp (RCBC), before being offloaded into the hands of casinos and gambling operators in Manila.

Bangladesh Bank has now filed suit against RCBC in a district court in Manhattan, and has recruited the NY Fed to provide “technical assistance” in helping the bank make its case at the trial.

In a statement, the NY Fed says: “The New York Fed and Bangladesh Bank believe that safe and reliable funds transfer services are critical for global financial stability, and that the type of fraud perpetrated on Bangladesh’s account at the New York Fed represents a threat to the international funds transfer system. This agreement demonstrates that the New York Fed and Bangladesh Bank are aligned in the pursuit of recovering the funds and directing litigation against those who were complicit in or benefitted from the fraud.”

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