Mayor Spiro Cheriogotis said Monday the city has terminated one employee and placed two others on paid administrative leave as internal investigations into the $14.7 million theft from the City of Mobile continue.
The city disclosed last Tuesday that the money was transferred to a fraudulent entity and that the FBI and the U.S. Secret Service were notified. Cheriogotis said the city’s IT systems were not breached and that the scheme relied on a fraudster posing as a legitimate vendor.
Cheriogotis released the following statement Monday afternoon:
“As a result of internal investigations into the $14.7 million theft, one City employee has been terminated. Two City employees have been placed on administrative leave with pay pending further investigation.
“Based on the facts and evidence as we know them today, our IT systems were not compromised. This was not the result of an employee clicking a bad link. To accomplish this theft, a fraudster impersonated a legitimate vendor and built misplaced trust with critical employees through a series of emails, documents, and phone calls.
“To be clear, nothing we have learned suggests this was an ‘inside job’. We will not be releasing names, positions, or personal information of the three employees in order to protect their safety. I understand the public’s anger. I am angry, too. The loss of taxpayer dollars to fraud and malfeasance is extremely painful.
“I am asking the public to direct your anger at the criminals. The people who did this are the same kind of criminals who prey on businesses large and small, public and non-profit entities, individual families and the elderly. This fraud was perpetrated by the same type of criminals who steal people’s life savings.
“My administration will continue working with the FBI and the Secret Service to seek recovery of these funds and to pursue the criminal actors involved. Our top priorities are putting protections in place to ensure this never happens again and holding the responsible parties accountable.
“We have learned much from our internal investigations, but we must allow the independent investigations to occur unfettered and reserve final judgment once their findings are complete. We are committed to transparency, and at the request of City Councilors, we will be sharing additional details during tomorrow’s Council session.”
Grayson Everett is the editor in chief of Yellowhammer News. You can follow him on X @Grayson270.
