More than $1.4 million has been stolen from Connecticut Higher Education Trust, or CHET, account holders, The Journal Inquirer writes.
Twenty-one account holders had their records accessed by unauthorized people which resulted in a total of 44 unauthorized withdrawals, totaling $1.416 million. More than $442,000 of that total was recovered or stopped, according to state Treasurer Denise L. Nappier. She said this is the first time that she’s aware of a breach in CHET’s more than 20-year history of providing a way for Connecticut families to save for college. There are more than 150,000 CHET account holders in the state.
“I am deeply concerned that these criminal activities have impacted CHET account holders,” Nappier said. “Until it happens to you, it’s hard to capture how unsettling it is when personal accounts have been compromised.”
TIAA-CREF Tuition Financing Inc., known as TFI, manages the portion of CHET that was affected, while the CHET adviser accounts managed by The Hartford were not impacted, Nappier said. CHET account data and online systems are housed and maintained by TFI and its service providers, she said, adding that the company has established system enhancements, additional internal controls, and more manual reviews intended to prevent more fraudulent activity.
Nappier, who is the trustee of CHET, said that affected account holders will have their CHET accounts fully restored by TFI “as if the unauthorized withdrawals never occurred,” Nappier said. The company also will provide two years of identity fraud protection services, identity restoration services, and $1 million in identity theft insurance coverage, Nappier said.
Federal, state, and local law enforcement agencies are conducting a coordinated investigation into the breach, and Nappier has requested an independent audit of fraudulent account activity and an independent review of TFI’s cyber, telephone, and manual security programs.
Nappier developed CHET, which has grown from $18.5 million to more than $3.3 billion in assets. In December, CHET was named one of the nation’s top five college savings programs. Nappier announced in January that she is not seeking re-election to the treasurer position, which she has held for 20 years.
CHET customers are encouraged to log onto their accounts, complete additional security questions, and regularly monitor their information.
Nappier is reminding all state residents to regularly check all of their online accounts for unauthorized activity, to consider using different user names and passwords for each account, and to change user names and passwords periodically.
