The hacking of the San Felipe Del Rio Consolidated Independent School District’s computer systems led to the reallocation of $2.14 million from the general fund to debt service payments by the school board, in order to cover the unauthorized transfer, a specialized publication announced.
The school district issued a release announcing the incident on Feb. 20. The funds were originally allocated to pay three bond issues due on Feb. 18.
During a special meeting on Feb. 24, San Felipe Del Rio CISD Board of Trustees approved moving $2.14 million from the general funds to cover bond payments, The Bond Buyer noted.
The publication, which states its mission as an independent information resource is to serve the municipal finance community through its website, e-newsletters, alerts, and daily print edition, published the story on Wednesday.
During Monday night’s meeting, board member Joshua Overfelt made a motion to approve the action, seconded by board member Fred Contreras, with a unanimous vote from the board without specifics on the agenda item, which was posted as a closed session for “Consultation with legal counsel … regarding cyber security events.”
After reconvening from the closed session the board voted on the “… budget amendment and authorization relating to payment of bond debt service,” as posted in the agenda.
“I hope that my fellow board members encourage administration to ensure that everything we talked about during closed session comes to be. Therefore, I motion to approve budget amendment discussed in closed session based on the advice of legal counsel,” Overfelt said.
Public Information Officer Reno Luna and other school district officials did not return a request for comment for this story as of press time, Friday night. Luna said the school district will be issuing a press release early this week.
The publication cites San Felipe Del Rio CISD interim Chief Finance Officer Amy Childress stating San Felipe Del Rio CISD Superintendent Dr. Carlos Rios planned to hand deliver the payment to BOK Financial, the escrow agent, when he was in Dallas during a meeting on Thursday.
“We will continue to work closely with authorities to bring justice to our community and recover the stolen funds,” Rios said in the Feb. 20 release.
The Bond Buyer also cites Childress saying the school district suspended electronic fund transfers for the time being.
Childress, the school district’s budget director, was named interim CFO after CFO Henry Arredondo was placed on administrative leave.
At the time of announcing the investigation, further details were not provided “due to ongoing law enforcement investigation.”
The reported fraudulent scam comes on the heels of a cybersecurity attack the school district is still recovering from. The malware attack took place on Feb. 8.
Gloss