ECONOMY & WORK
MONEY 101
NEWS
PERSONAL FINANCE
NET WORTH
About Us Contact Us Privacy Policy Terms of Use DMCA Opt-out of personalized ads
© Copyright 2023 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.
MARKETREALIST.COM / NEWS

MariMed Fell Victim to Fraudulent Email; Here's How Scammers Used it to Siphon off Money

MariMed fell prey to an email fraud scheme, resulting in transfer of $646,000 to a fraudulent.
PUBLISHED DEC 17, 2023
Pexels | Marijuana MSO MariMed Faces Unprecedented Cybersecurity Challenge
Pexels | Marijuana MSO MariMed Faces Unprecedented Cybersecurity Challenge

The cannabis industry has emerged as a profitable sector that has attracted several entrepreneurs as well as celebrities who want to invest in a product that has always been in high demand. One such enterprise, selling medical marijuana across different states, is MariMed and it was recently shaken up after falling prey to a highly sophisticated email fraud scheme, resulting in the inadvertent transfer of $646,000 to a fraudulent recipient. This attack on MariMed was orchestrated using a meticulously forged email, leading to the funds being transferred to an account at Chase Bank.

Pexels |
Pexels | Email Fraud Incident

MariMed, a Massachusetts-based MSO with operations spanning five states, confirmed the loss in its latest quarterly filing, was quick to emphasize that the incident was not a result of any shortcomings in financial discipline or governance. Instead, the company characterized it as a "very sophisticated, global fraud that took months of planning."

The initial response from MariMed suggested that the company acted with an urgency to halt the transfer. Chase Bank initially said that MariMed had identified the problem before the payment was delivered, prompting an investigation. But updates from the bank revealed that the funds had indeed been delivered to the scammer's account. MariMed is now collaborating with the FBI and local law enforcement in efforts to trace and apprehend those responsible.

The loss of $646,000 has been recorded as an expense in MariMed's financial statements, pending recovery efforts. Chief Communications Officer Howard Schacter expressed confidence that the company will recover the lost funds, either through the bank or via cybersecurity insurance.

Pexels  |
Pexels | Financial Impact on MariMed

The recent resignation of MariMed's Chief Financial Officer, Susan Villare, in the middle of a fiasco, has also raised eyebrows. The official statement from the company on Villare's departure provided no explanation or commentary, leaving room for speculation regarding a potential connection between her resignation and the email fraud incident.

Joseph Steinberg, a cybersecurity expert based in New York, emphasized that these incidents typically go beyond simple phishing attacks, involving meticulous planning, strategic targeting, and multiple steps. He warned firms and individuals against tactics such as reconnaissance, phone calls, and the exploitation of weak links, deployed by cybercriminals.

While Steinberg refrained from commenting specifically on MariMed's case, he highlighted the potential involvement of various factors, such as compromised information, confirmation over phone calls, or the exploitation of third-party weaknesses. Steinberg's warning serves as a critical reminder for businesses, especially those in lucrative industries like cannabis, to fortify their cybersecurity defenses against ever-evolving and sophisticated cyber threats.

Pexels
Pexels | Cybersecurity Safeguards

As MariMed grapples with the aftermath of this email fraud incident, the episode serves as a cautionary tale for businesses across industries. Businesses must recognize the potential indirect routes through which criminals can breach their systems, emphasizing the importance of safeguarding against vulnerabilities in third-party interactions.

In response to the incident, MariMed has implemented additional safeguards to protect against future fraudulent activity.

In conclusion, MariMed's experience serves as a stark reminder that even companies operating at the highest standards of financial discipline and governance are not immune to the evolving tactics of cybercriminals. As businesses navigate the ever-changing digital landscape, they need to fortify cybersecurity defenses.

MORE ON MARKET REALIST
Despite getting a high auction estimate, the owner of the Meiji Period lamp chose to keep it.
1 hour ago
The player, Gabriel Berkowitz pulled off a perfect night winning over $45,000 and a car.
2 hours ago
Harvey showed no mercy after he found out that Sweet Lou Dunbar didn't know how apps work.
6 hours ago
The founder of Plop Star made an unforgettable entry and a sad exit from the show.
1 day ago
The host is otherwise quick to reprimand families for backing absurd answers.
1 day ago
While the Marvel comic book fetched a $50,000 appraisal, Harrison felt it was too rich for him.
1 day ago
Jimmy Alexander became the first player to lose a brand-new car on season 43 of the show.
2 days ago
The contestant, Brianne Peterson got extremely unlucky with her letter picks for the final puzzle.
2 days ago
The guest was told that the Jasper Johns Flag Print wouldn't be valuable but it was worth thousands.
2 days ago
It didn’t help that Alvin Rosales was playfully scolded by the host just before losing the Bonus Round.
3 days ago
The photos featured some looks of the show's legendary former host, Alex Trebek, as well.
3 days ago
The player, Kate Stuntz, pulled off a miraculous win to take home over $68,000 and a trip to Iceland.
3 days ago
The owner couldn’t believe the value of Jane Peterson’s "The Floats" gouache painting.
4 days ago
The player, Callie DeWeese, failed to choose the right letters in the Bonus Round, leading to her loss.
4 days ago
The personal digs at the host have been relentless on the show by producers and players.
4 days ago
The guest had no idea how valuable her grandfathers Dutch tinware coffee pot was.
5 days ago
It wasn't one of Steve Harvey's jokes that cracked Bridget up so bad.
5 days ago
Fans now won't be able to stream more than five most recent episodes of the new season.
5 days ago
Despite the questionable morality of CATE App, Neal Desai managed to partner with two Sharks.
6 days ago
A supplier of Costco's Dubai Styled chocolate issued a notice regarding misinformation of allergens.
6 days ago