22 May 2017
register for the webinar

Bank settles with hacked customer over ACH fraud losses

29 November 2012  |  8185 views  |  0 handshake

A US bank has finally settled with a former business customer after years of legal wrangling over who was responsible for the loss of more than $500,000 in a cyber-attack.

In 2009 malware was used to steal Patco Construction Company's online banking credentials which the crooks then tapped to make ACH transactions worth hundreds of thousands of dollars.

Patco sued People's United - then called Ocean Bank - for the money it lost, arguing that the bank should have spotted the fraud and stopped it. The construction firm also said that by not requiring customers to use multi-factor authentication, Ocean did not use best practice.

Last year a court backed the bank but in July this was reversed by the First Circuit Court of Appeals in Boston, which called People's security measures "commercially unreasonable".

According to BankInfoSecurity, the court also told the pair that they should look to agree an out-of-court settlement. This advice has been taken and the bank has agreed to pay Patco for its losses. Initially the construction firm had also sought damages and legal fees.

KeywordsLEGAL

Comments: (0)

Comment on this story (membership required)

Finextra news in your inbox

For Finextra's free daily newsletter, breaking news flashes and weekly jobs board: sign up now

Related stories

Bank settles with hacked customer over ACH fraud

Bank settles with hacked customer over ACH fraud

20 June 2012  |  13413 views  |  0 comments
Another US bank sued by hacked customer

Another US bank sued by hacked customer

19 July 2011  |  12212 views  |  0 comments
US judge backs bank against customer who sued over hack

US judge backs bank against customer who sued over hack

08 June 2011  |  7983 views  |  3 comments

Related blogs

Create a blog about this story (membership required)
visit dh.comVisit www.capgemini.com/worldreportsvisit vasco.com/news/PSD2-compliant-solutions

Top topics

Most viewed Most shared
European banks lobby Commission to push ahead with screen scraping banEuropean banks lobby Commission to push ah...
8601 views comments | 29 tweets | 35 linkedin
Time for data-driven banking to come of ageTime for data-driven banking to come of ag...
8560 views comments | 28 tweets | 35 linkedin
Google and PayPal partner for mobile shopping by fingerprintGoogle and PayPal partner for mobile shopp...
8260 views comments | 27 tweets | 27 linkedin
Banks must get on AI bandwagon now – new Finextra researchBanks must get on AI bandwagon now – new F...
7954 views comments | 22 tweets | 29 linkedin
Twins fool HSBC voice biometrics - BBCTwins fool HSBC voice biometrics - BBC
7741 views comments | 19 tweets | 23 linkedin

Featured job

Six Figure Base + Commission + Stock Options
London

Find your next job