PORTLAND, Ore. – After months of uncertainty, the City of Portland has successfully recovered $6.7 million in public funds that were stolen earlier this year through a sophisticated fraud scheme. Officials confirmed the return of the money on Friday, though the criminal investigation remains ongoing.
Funds Tied to Bull Run Filtration Project
The stolen funds had been earmarked for the Bull Run Filtration Project, a long-delayed effort to build a 50-acre water treatment plant. The project, which has faced years of setbacks and soaring costs, is designed to safeguard the city’s drinking water supply.
The loss of millions of dollars earlier this year was yet another complication for the already troubled initiative.
Coordinated Recovery Effort
According to city officials, the funds were returned after an extensive, multi-agency collaboration involving the Portland Police Bureau, FBI, City Attorney’s Office, and the U.S. Attorney’s Office.
In a statement, the city said:
“The City is grateful for the extensive effort that helped to secure the funds and ensure they were returned.”
Officials added that the fraud investigation is expected to be lengthy, and they declined to provide additional details while the case remains active.
How the Scheme Worked
Court filings reveal that the scheme involved manipulating city officials into changing vendor bank account information. Believing the change to be legitimate, the city transferred the $6.7 million payment to a fraudulent account controlled by the scammer.
The stolen money was later traced to an account belonging to a New York law firm.
Lawsuit in New York
Earlier this year, Portland filed a lawsuit in New York to try to reclaim the funds. The lawsuit alleged that the law firm had received the stolen payment. However, the firm responded that it, too, was a victim of the fraud and was cooperating with investigators.
Ultimately, the funds were secured by the U.S. Marshals Service, which held them while recovery efforts played out in court. With the money now returned to Portland, the city has indicated it intends to drop its lawsuit.
Project Still Faces Challenges
While the recovery of the $6.7 million marks a significant financial relief, the Bull Run Filtration Project continues to face delays and rising expenses. The facility is intended to meet federal requirements for safe drinking water, but its price tag has ballooned far beyond initial estimates.
City leaders say they remain committed to completing the project despite setbacks, emphasizing that the return of the stolen funds ensures that taxpayer money will still be used for its intended purpose.
Looking Ahead
For now, the city has closed one painful chapter in the project’s history. But with the criminal investigation still underway, officials caution that more details may emerge about how the fraud was carried out and who was responsible.
What is clear, however, is that Portland has managed to recover its multimillion-dollar loss — a rare outcome in large-scale fraud cases — and residents can expect the funds to go back toward the long-delayed water treatment plant.
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