Updated: Breaking News: Cyber Criminals Steal Bar Harbor's School Construction Payment
Superintendent Hopeful that $1 million can be recovered
BAR HARBOR—Bar Harbor municipal and school officials are dealing with a cybercrime that may have compromised some of the bond money to pay for the rebuilding of the Conners Emerson School, a project that has already begun.
It is an ever-evolving situation, but School Superintendent Mike Zboray became aware that the town’s bond payment for the new school was stolen, March 11.
“The crime involved a fraudulent request to change bank account information that was submitted on January 9, 2025, and subsequently processed by school staff,” Zboray wrote in a statement to the Bar Harbor community, March 14. “As a result, when Wright-Ryan Construction submitted a legitimate payment request on February 10, 2025, for $1,066,754 for the Bar Harbor School construction project, the funds were unknowingly transferred to the fraudulent account.”
School staff reported the issue immediately to the Bar Harbor Police Department, the town government and the Federal Bureau of Investigations (FBI). The attack is being investigated by the FBI.
“We also notified our bank and insurance providers, and the compromised payment system has been disabled,” Zboray wrote. “Our current understanding is that the account that received the funds has been frozen, and it appears the funds have also been secured.”
Zboray said the school is “actively working to transfer these funds” back to its account.
“While we cannot yet guarantee that no funds have been lost, we are encouraged by the current information, and we remain hopeful that the full amount will be recovered,” Zboray said.
He said he is trying to reduce the possibilities of this happening again.
“We have begun conducting a thorough review of our financial procedures in collaboration with our cybersecurity team and have reinforced safeguards to strengthen our payment process,” Zboray said. “Furthermore, accounts payable staff across the district will receive additional advanced training to enhance security awareness and help prevent similar threats in the future. We will continue to monitor the situation closely and communicate with town officials and the public. We appreciate the community’s patience and support as we work to resolve this matter and ensure the continued security of district financial operations.”
While the school department uses the town’s EIN “for financial processing, town accounts remain secure,” the town office said in a press release later Friday afternoon.
A cyber attack last fall in White Lake Charter Township, Michigan stole over $25 million in infrastructure bond proceeds. Those hackers used spoofed email addresses and used them to create incorrect wire instructions.
Voters approved the bond for the new school in June, 2023 with a resounding vote of 1,005-502. The $62.9 million tax-exempt general obligation bond was sold in September 2024. The project was $11 million over budget when it went out to bid in June 2024.
A municipal bond is similar to a loan. The holders of the bonds are the creditors for it. Investopia describes it as “a type of debt security issued by local, county, and state governments. They are commonly offered to pay for capital expenditures, including the construction of highways, bridges, or schools.
“In exchange for borrowed capital, bondholders/investors are promised interest on their principal balance—the latter being repaid by the maturity date. Municipal bonds are often exempt from most taxes, which makes them attractive to people in higher income tax brackets.”
The email in full is below.
At 3:30 p.m., the town also put out a statement, which we’ve included in full below:
Fraud Incident Involving School Contractor Payment
“The town has been made aware that the school department has been the victim of a cybercrime involving payments processed by the department.
“While this is a school department matter, the town is closely monitoring the situation to ensure all necessary actions are taken on our end to protect town accounts from any potential breaches. Immediate steps have been taken, including notifying law enforcement and working with our financial institutions to secure our accounts. Additionally, the town has filed an insurance claim to formally notify our insurer of the breach. The FBI is now actively investigating and leading the response to this crime.
“Although the school department operates under the town’s EIN for financial processing, town accounts remain secure. We have also been informed that the fraudulent account that received the diverted funds has been frozen, and efforts are underway to recover the full amount. While the outcome is not yet certain, this development is encouraging, and we remain hopeful that the funds may be fully restored.
“As an added precaution, we are working with our auditors and financial institutions to review all procedures and protocols, strengthening safeguards against any further risks. We will continue to monitor the situation closely and ensure that both the council and the public are kept informed as more details become available.”
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