UPDATE: Following a widespread fraud attempt, Hamilton Health Care System has recovered a majority of the disputed funds. 

On November 29, 2018, Hamilton Medical Center sent a payment of $105,036, and on December 12, they paid one of $1,157,144.91.

These funds were transferred using valid account numbers and a spoofed email address from Brasfield & Gorrie, a legitimate banking institution. 

After a thorough, a combined investigation by the Dalton Police Department and the FBI, Hamilton Health Care System was able to file an insurance claim and have the most recent transaction reversed. 

Investigators are working to locate the remaining $105,036.00. 

 

The full statement from Hamilton Health Care System: 

Hamilton Health Care System has recovered the bulk of the funds recently disputed as part of a sophisticated fraud attempt. As assured by Hamilton CEO Jeff Myers, Hamilton has continued to actively investigate and aggressively pursue all available legal recourse. “We take this matter with the utmost seriousness, and we have been diligently pursuing recovery and fully cooperating with the FBI and local law enforcement. I would like to extend my sincere appreciation to our Financial Services Director, Steven Bridenstine, for his quick actions and cooperation with the FBI and law enforcement, as well as to Special Agent James Harter of the FBI and Detective Aaron Simpson of the Dalton Police Department, without whom this successful recovery would not be possible. Through the efforts of our dedicated Hamilton team, the assistance of the FBI and Dalton Police Department and continued engagement with the applicable banking institutions, $1,157,144.91 of the funds have been successfully recovered.”

As set forth in the police report previously mentioned in The Dalton Daily Citizen, Hamilton’s Financial Services Department received an email from a source purporting to be the Chief Financial Officer of Brasfield & Gorrie, a large construction firm, requesting that Hamilton change its payment method from check to electronic payments.  Consistent with Hamilton’s actions with prior requests for electronic payment, a voided check was requested from the company. The voided check received was from an actual banking institution with appropriate routing and account numbers. Accordingly, payment was issued to Brasfield & Gorrie on November 29, 2018 in the amount of $105,036.00 and on December 13, 2018 in the amount of $1,157,144.91. A representative from Brasfield & Gorrie indicated that the company was aware of the spoofed email domain (brasfield-gorrie.us<http://brasfield-gorrie.us/>), as other clients had received the same email request, and had taken action on November 21, 2018 to suspend any activity from or to that domain. However, no notification was ever provided by Brasfield & Gorrie to its clients.

Upon confirming the request was fraudulent, Hamilton notified the appropriate banking institutions. Hamilton promptly submitted two separate Letters of Indemnity to said banking institutions requesting that the payments be reversed and funds returned to Hamilton. These letters allowed the banks to investigate the fraud on their end.

Hamilton does have applicable insurance coverage available for this type of crime, and we did file a claim with our insurance carrier. Our insurance carrier required that a police report be filed with our local authorities. The Dalton Police Department detective who received the report then made the decision to contact the FBI.

While this is an extremely unusual and isolated occurrence, Hamilton takes this matter and the gravity of the situation very seriously. We are performing an intense review to ensure our internal processes are secure and appropriate, and in a vigilant effort to safeguard assets, Hamilton undergoes a rigorous audit process on an annual basis, which includes an independent audit by a certified public accounting firm which provides an objective opinion on financial reports and internal controls.

Moving forward we will continue our full cooperation with the FBI and local authorities in pursuit of the remaining $105,036.00. We appreciate the community’s patience and understanding as we complete the investigation. We are grateful for the honor and privilege of providing healthcare to the communities we serve. Our mission and vision remain unchanged, and we are committed to providing the highest quality, compassionate care to our patients and families, with the finest technology and services available today.


 

 

 

 

PREVIOUS: Dalton police are investigating after Hamilton Medical Center reported they were scammed out of over $1.2 million.

The director of finances for the hospital said they received an email from who they thought was the construction company, Brasfield & Gorrie, working on new additions to the hospital.

The email was from Randy Freeman, the chief financial officer for Brasfield & Gorrie, and it asked that instead of paying the construction company by check, they send an electronic payment.

Hamilton Medical Center agreed and asked for a voided check from the company. They received a voided check from "Harris Bank" out of Chicago.

On November 29, 2018, Hamilton Medical Center sent a payment of $105,036, and on December 12, they paid one of $1,157,144.91.

The director of finances said during a meeting, the topic of fraud was discussed, which prompted him to contact the construction company to make sure they had received payments.

The construction company said they had not received any payments nor had they sent a request that payments be made electronically.

Channel 3 reached out to Hamilton Medical Center. CEO and President of Hamilton Health Care System Jeff Myers said:

"This incident is being actively investigated. This is a matter we take with the utmost seriousness. Hamilton is aggressively pursuing all available legal recourse and is fully cooperating with the FBI and local law enforcement. As this is a current open federal investigation, we are unable to comment any further at this time."

Stay with Channel 3 as we learn more from this developing story.