Security & Fraud

NY Fed Calls On Philippine’s Central Bank To Help With Bangladesh Bank Hack

The Federal Reserve Bank of New York is calling upon the Philippines’ central bank to aid in helping Bangladesh Bank get back the $81 million stolen by hackers earlier this year.

According to a letter from New York Federal Reserve General Counsel Thomas Baxter to Elmore O. Capule, the general counsel at the central bank of Philippines, Baxter asked the Philippines to take all steps necessary to support Bangladesh Bank in its efforts to get back the stolen money.

Reuters, which saw the letter, reported that Baxter said the payment instructions that resulted in four money transfers totaling $81 million to beneficiary accounts at Rizal Commercial Banking Corp. in Manila were confirmed using a reasonable security producer, but the compromise happened because they were issued by people using stolen credentials. The report noted Bangladesh Bank will give the New York Federal Reserve a report that looked into the scam, put together by FireEye, a cybersecurity company based in the U.S. The New York Fed had been asking to see that report.

In February, Bangladesh Bank was broken into by hackers that tried to steal as much as $951 million. It was able to take off with $81 million in what is considered one of the largest cyberthefts worldwide. After the money landed at Rizal Commercial Banking Corp., it was laundered by way of the casino industry in the Philippines, and investigators have not been able to trace it since then. No one has been arrested in the heist.

A Bangladesh Bank spokesman told Reuters that the New York Federal Reserve and the Philippines’ central bank are working with the Bangladesh central bank to recover the stolen money. Previously, Bangladesh Bank, the New York Federal Reserve and payment processor SWIFT have been at odds over the payment instructions in the heist, but the relations between the New York Fed and Bangladesh Bank appear to be improving.

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