Sebastopol City Hall

The City of Sebastopol announced on July 16 that two unrelated cyber incidents have downed the police department’s computer system and ripped off $1.2 million from the city’s reserves through a “fraudulent email request.”

The County of Sonoma that holds onto the reserves of various cities executed a wire transfer of $1.2 million from Sebastopol’s account to “a third party” through such an email request, the press release said.

The city is partnering with the county, law enforcement and insurers to get that money back in some way after the Sebastopol City Finance Department caught the transfer and let the county and city administration know.

Next, city police are investigating a compromise to the Sebastopol Police Department’s (SPD) computer system that occurred on July 11.

Because the investigations are ongoing, City Manager Larry McLaughlin said the city is unable to speak on their plans to respond or to who is performing the investigations.

Likewise, he said he could not discuss who might be suspected of breaching the city’s cybersecurity or whether there has been any threat of ransom, for SPD at least. He said he could not speak much about either incident.

“To our knowledge, there is no leaked information or threat of same,” McLaughlin said. “Believe me, we really want to say as much as we possibly can. I know the public will have a lot of questions about this,” he said.

Sebastopol Police Chief Kevin Kilgore said that while staff are now using pen and paper to perform some duties like recording dispatch calls, they continue to be fully operational, and the press release said no public safety services are expected to be “interrupted.”

McLaughlin said the city is sharing the information out of transparency, because the Sebastopol City Council is about to receive a finalized budget to adopt on July 20 that will be impacted by the loss of $1.2 million they hope is only temporary.

The city’s essential operations will continue to be funded, but the city council will have to decide what other projects or items will need to be postponed to stay balanced at the meeting, the city manager said.

According to McLaughlin, the reserves had been enough to meet the city’s projected deficit, but with the $1.2 million loss, the reserves would drop below the city’s 15% minimum reserves in its yearly operational budget if it went forward with all its expenditures planned so far.

The total cost of the police department’s computer system compromise hinges “on the city’s cyber insurance coverage, which provides for restoring and resecuring of the system,” per the press release.

Editor's Note: The headline has been corrected to reflect more accurate information from Sebastopol Police Chief Kevin Kilgore that the SPD computer systems compromise is yet to be defined a cyber attack while the investigation continues. 

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