Chandler City Council unanimously approved Jan. 23 a $100,000 settlement with Vincon Engineering Construction LLC after the city's payment to the company was fraudulently rerouted elsewhere.

The city paid Vincon Engineering Construction LLC nearly $172,000 for services rendered, but the payment never made it to the company, said Kelly Schwab, Chandler's city attorney, during the Jan. 23 meeting. Schwab said the city received an email from the company asking to change bank information and the city complied, but both parties later discovered Vincon's information had been compromised. Schwab said the email address was the same as the email address the city had on record and had previously used for the company.

"Neither Vincon nor the city were at fault," Schwab said.

Schwab said the city has fraud protection insurance to cover damages, which will pay a majority of the settlement, but the city does have to pay a $25,000 deductible.

City Manager Marsha Reed said during the meeting the city was working to ensure something like this never happens again.


Moving forward, the city has instituted a policy requiring verbal confirmation of all changes regarding financial information, officials said.