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Tipline Investigation: Hackers wipeout small business owner’s bank accounts

SANTA BARBARA, Calif. - Our NewsChannel Tipline investigation delves into the dark world of hackers and thieves. We all deal with passwords, two-factor authentication, security questions, multi-step whatevers, it’s maddening. We do all of that to stop or at least slow down the crooks. However, sometimes, even that’s not enough.

Michael Epley’s nightmare began last year. He was driving home from vacation in Mammoth Lakes when his son’s phone rang.

“It was Verizon and they were asking if I had just changed the administrator on my account and I told them, ’No, I hadn’t,’” said Epley.

A couple hours later, Epley arrived home.

“My friend was there house sitting and he said he had just called me and that somebody else answered the phone,” said Epley.

That’s when Epley realized something was wrong. He hadn’t received any text messages or phone calls for a while. So, he drove straight to the Verizon store in Santa Barbara.

“And they said, yea that two administrators were added to my account and they went ahead and changed it back to me and then they let me know that my SIM card number had been changed,” said Epley.

A SIM card identifies a phone, its mobile number, controls security features and access. Essentially whoever controls the SIM controls the phone and everything in it including access to bank accounts. Epley says his next stop was Union Bank where he had his business account. He spoke with a manager.

“And he kinda laughed and said, ’Ah, there’s no way that that’s happening. Nobody’s in your account.' And I said, 'just take a look and let me know.' And sure enough, pretty much everything was being transferred out of my account.”

And it was happening right before their eyes. Epley said the bank immediately put a freeze on the account and hoped that would be enough to stop the transfers. However, days later all of the money disappeared from his small business account, about $35,000.

“So, it got transferred to Zelle, and then it got transferred to Chase and also
got transferred to Wells Fargo,” said Epley.

Right after that, Epley also discovered the crooks stole all of his 401k retirement savings. He filed police reports with Santa Barbara Police and tried to figure out how this happened. Epley said, at first, Verizon was helpful and admitted the crooks called the wireless carrier posing as Epley and convinced a live Verizon agent to give them access to Epley’s account.

“And as soon as they did that, they were able to change passwords and once they
changed the passwords they could login and do whatever they want,” said Epley.

Epley believes Verizon gave the crooks the keys to his phone allowing them to steal everything. That’s when he called our Tipline looking for help. We contacted Verizon hoping to get more information. For
example, when the hackers called Verizon trying to get access to Epley’s
account did the Verizon representative ask for the password, did they use two
factor authentication or ask any of the secret security questions?

However, Verizon responded with a different version of events. Verizon wrote, “Our
Fraud team determined that no unauthorized users were able to access this
customer’s Verizon account” and there was no direct fraud associated with
Epley’s account. Verizon also insinuates the crooks possibly hacked Epley’s
personal email to get in and steal everything.

Epley told us that’s news to him.

“They won’t tell me anything without a subpoena,” said Epley.

The NewsChannel also contacted Wells Fargo, Chase and Union Banks. Union Bank was the only one willing to help Epley by agreeing to do a more thorough investigation. About two months later, Union bank agreed that Epley is a victim and offered to help.  We don’t know the details, but we do know that Epley is happy with the way it ended.

“Obviously, you guys have done me a huge, huge favor and I don’t know how to go
about it any other way, that is obviously something that couldn’t have happened
without you,” said Epley.

We want to extend a huge thank you to Union Bank for helping Epley. As for Verizon, we asked if it's disputing Epley's version of events and so far, Verizon is not disputing it.

Epley also got all of his retirement money back because it was insured. That means the crooks got away with almost $300,000.

Santa Barbara police officials said they are still investigating.

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C.J. Ward

C.J. Ward is the evening anchor for KEYT News Channel 3 and the station’s lead investigative reporter. To learn more about C.J., click here


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