Bangladesh Bank weighs lawsuit against NY Fed over hack

Tue Mar 22, 2016 6:24pm EDT
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By Serajul Quadir

DHAKA (Reuters) - Bangladesh's central bank has hired a U.S. lawyer for a potential lawsuit against the Federal Reserve Bank of New York after hackers stole $81 million from its account with the NY Fed, according to an internal report by the Bangladesh bank.

After the report surfaced on Tuesday in the Bangladesh capital of Dhaka, U.S. Representative Carolyn Maloney called for a probe of last month's cyber attack on Bangladesh Bank.

In one of the largest cyber heists in history, the hackers ordered the New York Fed to transfer $81 million from Bangladesh central bank funds to accounts in the Philippines.

“This brazen heist from the Bangladesh central bank’s account at the New York Fed threatens to undermine the confidence that foreign central banks have in the Federal Reserve, and in the safety and soundness of international monetary transactions,” Maloney, a New York Democrat, said in a statement.

The U.S. Federal Bureau of Investigation is helping investigate the heist, which led to the ouster of Bangladesh's central bank governor.

Maloney also sent a letter to New York Fed President William Dudley, requesting a private meeting with bank staff to discuss the cyber fraud.

She said she wants to ask a series of questions, including whether it is appropriate to rely solely on the SWIFT global bank messaging system to authenticate outgoing payments from foreign central bank accounts.Her comments are the first sign that the attack could gain political traction in the United States. The New York Fed has faced separate political criticism since the financial crisis for missteps and perceived conflicts of interest in its role as the central bank's top Wall Street regulator.

“We fully intend to reach out to the congresswoman and will endeavor to address her questions," a New York Fed spokeswoman said on Tuesday.   Continued...

Commuters pass by the front of the Bangladesh central bank building in Dhaka March 8, 2016. REUTERS/Ashikur Rahman