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City of Sioux Falls scammed in vendor fraud


City Police Capt. Blaine Larsen said the city’s finance department in mid-April received via e-mail a vendor update request that appeared to be legitimate to update the vendor’s electronic payment information.

Later in the month, police said the city transferred two payments to the new bank routing address for legitimate work completed by the vendor.

This past Wednesday, May 2, the city was contacted by the actual vendor looking for its expected payment and the fraud was discovered.

“This type of scam is a common fraud activity that has occurred across the country and is called automated clearing house fraud,” Larson said. “This case is being investigated as a felony under South Dakota law.”


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