Innovation Hub hacked PDF Print E-mail
Another Blue IQ company is in the spotlight for poor controls, as R9 million is hacked from its accounts.

 

Fraud and corruption in Gauteng agency Blue IQ have come under the spotlight again, as one of the big-spending technology holding companies loses over R2 million to cyber criminals.

 

While the Innovation Hub Management Company has remained quiet on the issue, it has been revealed that the company had failed to prevent over 218 attacks from hackers, which cost it millions.

The Innovation Hub is a wholly-owned subsidiary of the troubled Blue IQ investment holdings, which has also previously been slated for poor financial management and weak internal controls.

The management company reported in its financial statements for the 2008/9 period that over 218 fraudulent transactions, which occurred between 15 and 18 November 2008, amounted to losses of over R9 million. The company only recovered R6.5 million by March last year and recorded a loss of R2.4 million.

The Innovation Hub says it uses electronic identities and passwords, which it says were stolen by means of spyware or key-logger software.

While the company says the fraud was reported to the police and this was followed up with a forensic investigation by PricewaterhouseCoopers forensic investigators, little information has been provided about the investigation.

The company does, however, note that preventative measures have been implemented to tighten controls, following recommendations made in the forensic audit.

Squandered money

While the Gauteng Department of Economic Development, which oversees Blue IQ operations, previously stated it would introduce tighter financial and security controls for the agency – it has remained mum on this issue.

Following an unfavourable report by the auditor-general on the state of affairs at Blue IQ, the department promised that irregularities and financial transgressions in the agency`s technology holdings would be a thing of the past.

According to the AG`s report, spending at the Blue Umbrella project – the Gauteng broadband infrastructure development initiative – has not followed the required supply chain management processes and has not been based on approved budgets.

Despite spending over R9 million and receiving millions in government grants for the Gauteng Link project, the provincial government had also failed to deliver on its long-awaited biggest broadband infrastructure project.

Blue IQ did not provide comment by the time of publication.

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