Capitol Hill credit fraud investigation continues
 

Seattle Gay News
Mobile Edition
rss: SGN Calendar For Mobile Phones http://sgn.org/rssCalendarMobile.xml



SGN Mobile Front Page

SGN ARTS & ENTERTAINMENT SECTION

MOVIE REVIEWS
CALENDAR
NORTHWEST NEWS CALENDAR
CLASSIFIED

click here to go to the main SGN website

 

posted Friday, November 5, 2010 - Volume 38 Issue 45

Capitol Hill credit fraud investigation continues
by Shaun Knittel - SGN Associate Editor

The ongoing investigation by the Seattle Police Department and a Secret Service task force to catch the individual or individuals behind a wave of fraudulent credit and bank card charges continued this week, with one local business stepping forward to say that although their credit system was compromised, the problem has been addressed and no other fraud can be conducted.

Matthew Walsh, one of the partners behind the popular Capitol Hill eatery Broadway Grill, confirmed on November 4 that the Grill was not only a point of interest in the Secret Service investigation, but the restaurant was also a victim of fraud.

According to Walsh, the Grill's bank and credit accounts were breached, and the same criminals who were committing bank/credit card fraud on their unsuspecting customers also tried to swoop in and completely wipe out the business accounts.

'I am seriously worried about the future of our business without the support of our community,' Walsh told the Capitol Hill Seattle Blog, which first broke the story last week. 'We have been growing by leaps and bounds since I took over in June - not only in our new menu and food quality, but also in our day to day operation. It is my hope that we have touched enough lives over the years to be able to count on our beloved customers for their support and continued patronage in this difficult time.'

Over 100 people have reported fraudulent activity within the past two weeks. Each report received by the Seattle Police Department and financial institutions in the area all contained the same theme: The victims had all been patrons of Capitol Hill/Broadway businesses. This prompted a major investigation into the subject.

The United States Secret Service is leading the investigation, with the Seattle Police Department providing assistance.

According to David A. Iacovetti, the agent heading the Seattle office of the Secret Service's Electronic Crimes Task Force, the immediate threat to credit and bank accounts on Capitol Hill has been contained. In addition, he said that it is too early to release details of how the information was accessed.

'In the newest Seattle case, police and Secret Service investigators say they've identified multiple points of compromise, and the businesses involved have upgraded their anti-virus software so the fraud cannot continue,' Iacovetti told KOMO news. 'The Electronic Crimes Task Force is pursuing leads on suspects, but the businesses involved are not being identified at this time.'

Both the Secret Service and Seattle Police Department say that no 'skimming' device was used, nor did any employees of Capitol Hill businesses record or sell patrons' credit card information.

'A skimming device is something that is put over a card reader that steals the information unbeknownst to the user,' said Sgt. Sean Whitcomb, a spokesperson for the Seattle Police Department, laying to rest rumors that such a device was used in the current rash of incidents on the Hill. 'This type of fraud can happen at an ATM, gas station, or parking meter, but that is not what happened here.'

Investigators have yet to say how the account information was breached at Broadway Grill. Action Systems, Inc., the Grill's point of sale (POS) service provider, discussed the likelihood of how the criminals got a hold of the important accounting data:

'Since the release of Restaurant Manager v15.1 in 2006, all software designed by ASI has been certified as fully compliant with the Data Security Standards of the Payment Card Industry [PCI]. & Restaurants using Restaurant Manager v15.0 or earlier have been notified repeatedly that they must upgrade to a more current version of the software before they will be able to operate as a PCI-compliant business,' Action Systems, Inc., told CHS Blog. 'It is the restaurant's responsibility to act on these repeated warnings.'

In addition, the POS service provider said it is important to note that there are many requirements for PCI compliance that do not relate at all to POS software - in other words, restaurants need to adhere to all PCI requirements in order to ensure the protection of sensitive consumer information.

According to Jeanie Walker, a representative for Seattle-based POS provider Dinerware, account breaches can happen from the technology side of the process, or from the restaurant's own practices involving payment systems.

'There are 12 steps to being compliant,' Walker told CHS Blog. 'Five are in the software, seven are on the restaurant side.'

She said that holes on the restaurant side can range from failing to make the Wi-Fi isolated and secure on a separate network from the point of sale system to storing credit card information incorrectly. Still, the software side can break down, too.

Tom Willis, a senior fraud analyst at Javelin Research, says the Seattle wave has the earmarks of a software hack. He told CHS Blog the fraud is 'indicative of the smash-and-grab-type mentality,' during which the objective is to net the largest amount of money in the quickest time frame, 'and get out before you leave too many clues about who you are.'

That may be exactly what a local Seattle-based gang has done. As of yet, neither the Secret Service nor the Seattle Police Department has reported any suspects in the case.

In truth, the number of victims might easily exceed the number reported because not everyone who was contacted by their financial institution regarding fraud has filed a report with the Seattle Police Department.

'The fact that card charges are being made illegally is something we would investigate,' said Sgt. Whitcomb about the department's involvement in the case. 'This is a federal crime.'

Though the Seattle police are not the lead agency on investigating this wave, they continue to be on the front lines by collecting reports from the public. If you have found that your account was compromised, contact your financial institution and then report the fraud to the Seattle Police Department at (206) 625-5011.

'If people do nothing else, we want them to regularly check their bank statements to protect themselves from being defrauded and paying for someone else's charges,' said Whitcomb. 'Report fraud so we can get the info to the Secret Service.'



next story
Capitol Hill credit fraud investigation continues
------------------------------
ELECTION UPDATES: Patty Murray wins, Rick Larsen leads, Dems still control legislature
------------------------------
McDermott heads to King County Council
------------------------------
Generation gap divides troops on Gays in the military
------------------------------
Finding your festival place
------------------------------
Candidate Zeiger's homophobic remarks televised in 2006
------------------------------

------------------------------
Stop outing Gays, Uganda court tells tabloid
------------------------------
Obama appoints record number of open homosexuals
------------------------------
Voters say, 'No new taxes!'
------------------------------
Pro-equality Iowa judges ousted
------------------------------
Peppercorn Bistro holds South Seattle Mixer
------------------------------
Gay man likely to become next president of Ireland
------------------------------
Ask Michael: Fear fuels hatred
------------------------------
In wake of suicides, Gay actor Chris Villa tells story
------------------------------
Megachurch pastor announces he's Gay
------------------------------
BREAKING NEWS
------------------------------
Gay Veteran, 81, Awaits Repeal of 'Don't Ask' Policy
------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------

------------------------------
 
search SGN
SERVING SEATTLE AND THE PACIFIC NORTHWEST FOR 36 YEARS!