Bank Muscat Insurance Covers Nearly $40 Million in Global ATM Heist (Dec. 2, 2013)
Oman’s Bank Muscat said it will recover nearly $40 million the bank lost in a global bank heist involving prepaid cards earlier this year, now that the bank’s insurers have agreed to foot the bill for the loss. Bank Muscat was among the institutions targeted in a coordinated plan to hack into financial systems via payment processors, steal prepaid debit card data and make millions of dollars in ATM withdrawals on two separate dates; Dec. 22, 2012, and Feb. 19, 2013; Bank Muscat was hit on the second date. Five Yonkers, N.Y., men were arrested last month in connection with the heist, bringing the total number of defendants charged to 14. Authorities said the hackers were able to breach the cards’ security protocols to drastically increase the balances and remove withdrawal limits on the accounts in a scam that underscored the importance of processors’ security measures, according to many industry observers.
In the wake of the heist, Bank Muscat was forced to take a $39 million loss provision in its earnings for the first quarter of 2013, but will reverse the loss in its Q4 earnings, after the bank’s insurers agreed to indemnify $38.8 million of the loss, the bank said. Shares of the bank’s stock jumped several percentage points in early trading on the Omani stock exchange in the wake of the announcement.
