The city of Portland announced on Wednesday evening that it has fallen victim to a fraud scheme that resulted in the loss of $6.7 million intended for the long-awaited Bull Run Filtration Project. This project aims to establish a 50-acre water treatment facility, which has faced significant delays due to rising costs.
Fortunately, the city confirmed that the lost funds have been secured and are currently held by the U.S. Marshals Service. In light of these developments, Portland plans to withdraw its lawsuit in New York. A city statement emphasized, “The City is taking this matter seriously and is making every effort to ensure the return of public funds and that those responsible are held accountable. While we must limit what can be shared during the ongoing investigation, we are committed to transparency and will provide updates as appropriate.”
City officials refrained from providing further details about the fraud due to the active investigation but noted that the $6.7 million was “redirected as a result of this fraudulent activity.”
Initially, the city filed a lawsuit in New York to recover the funds, which had been deposited into the account of a New York law firm. However, the firm later claimed it was also a victim of the fraud and is cooperating to retrieve the lost money.
The lawsuit alleges that the perpetrator tricked the city into altering the bank account information for the vendor, causing the payment to be sent to an account controlled by the scammer. The city collaborated with the FBI to trace the stolen funds back to the New York law firm’s account, although it remains unclear what connection exists between the scammer and the firm.
With the funds now secured, Portland plans to discontinue its legal action in New York. Mayor Keith Wilson expressed gratitude for the swift response from local and federal law enforcement, stating, “The City of Portland is committed to safeguarding public funds. We’re grateful for the fast action of local and federal law enforcement to stop the fraudulent transfer before it landed in the wrong hands. We’ll continue to collaborate with law enforcement and other partners on the recovery effort and any subsequent prosecution, ensuring full accountability.”
