The Ninth and Fifth Circuits May Limit Coverage under the Computer Fraud Provision of Your Insurance
Published by David Thurber on Nov 04, 2016
In the Appellate courts in Pestmaster Servs. vs Inc. Travelers Cas. & Sur. Co. of Am., No. 14-56294 (9th Cir. July 29, 2016 ) and Apache Corp. v. Great Am. Insur. Co., No. 15-20499 (S.D. Tex. Oct. 18, 2016) found in favor of the insurance companies in denying coverage for the alleged third party fraud perpetrated on these companies. In summary of these cases, outside criminals sent email directions to these companies purporting to be their business vendor (the payroll vendor in one, and a buyer of assets in the other), directing them to change the deposit requirements for the electronic transfer of funds (EFT). We are talking about a substantial sum of money in both cases.