Fraudsters targeting an Omaha company last summer used extremely well-targeted emails to convince its controller to send a series of wires totaling $17.2 million to a bank in China.First, there were emails, supposedly from the CEO, saying that Scoular was buying a company in China. The emails weren't from the CEO's official email address, and, moreover, warned the controller not to communicate about the deal through other channels "in order for us not to infringe SEC regulations.\u201dThe emails also instructed the controller to get the wire instructions from an actual employee of the company's actual accounting firm, KPMG. Plus, the phone number provided in the email was answered by someone with the right name.Since Scoular was, in fact, discussing expanding in China, the controller fell for the emails and sent off the money.The KPMG employee did exist, according to FBI documents, but it wasn't his email, nor his phone number, and he's never heard of Scoular. While the email looked like it came from a valid KPMG email address, kpmg-office.com, it was actually based on a server in Russia and the telephone number listed was a Skype account registered using an IP address in Israel."It was discovered in June and promptly reported to the authorities," said Tara Gurney, Scoular's brand marketing and corporate communications manager, who confirmed the details of the fraud and that the controller who lost the money was no longer with the company."We're hopeful that some of those funds can be recovered," she said but added, that, to her knowledge, none of the money has yet been returned."The investigation is still under way and that limits what we can say about what's being done," she said.In late January, the FBI asked the courts for seizure warrants against the company that they say ended up with the money, Shanghai-based Dadi Co Ltd.If a seizure order is issued, the seizure would be executed by Chinese authorities based on a mutual legal assistance agreement with the U.S."It was unfortunate," Gurney said. "Anytime something like this happens, it's regrettable. But it doesn't affect our ability to do business as usual."Scoular is a commodities trading firm, ranked by Forbes as the 55th largest privately held US company.The company has reviewed its systems and processes, Gurney said, but declined to provide any specifics about the new security measures.But security experts say that some common-sense practices could have prevented this fraud."Make sure employees are empowered to respectfully challenge requests, rather than being in fear of refusing an executive demand," said Charles Tendell, CEO at Denver-based Azorian Cyber Security.Jerry Irvine, CIO at Chicago-based Prescient Solutions, suggested that companies require second-party confirmation of largest transactions to help protect against this kind of targeted spear phishing."This is not an unusual event," he said. "I know of two instances in the Chicago area where similar events occurred."Talbot Harty, CEO at Fremont, Calif.-based security vendor DeviceAuthority, Inc. suggested that companies also create authorization codes, or phrases, to use for high-value transactions.Financial institutions should also step up and take one some of the responsibility for these kinds of frauds, experts say.For example, financial institutions can offer two-factor authentication, or two-person controls to move funds above a certain limit, said Todd Inskeep, advisory board member at RSA Conference.Companies should also ask their banks if they offer insurance for online transactions, or escrow services for securing off-shore transactions."We also like to see an agreement with banking partners where the liability for any failure of the financial institution to adhere to protocol would be assumed 100 percent by the banking institution," said Damian Caracciolo, vice president at Cleveland-based CBIZ, Inc. "A simple call back and confirmation procedure may have prevented this from ever getting past the first fraudulent email."