Arrests made in US credit 'fraud'

The attacks sparked a frenzy of cash withdrawals

By Jane Standley BBC correspondent in New York

New York city prosecutors have begun arresting more than 100 people who they accuse of stealing $15 million (£10 million) from a credit union when its computers failed after 11 September.

Prosecutors at the Manhattan District Attorney's office said as many as 4,000 people were being investigated for taking advantage of the computer failure to overdraw their accounts.

Many refused to pay the money back when the fraud was discovered.

A frenzy of illegal cash withdrawals began almost immediately after the attacks.

Unlimited access

The credit union, which has its headquarters across the street from the site of the World Trade Center, lost its computer link with the New York Cash Exchange - the network of cash dispensing machines in the city.

The chaos left the credit union unable to check fund levels

This allowed virtually unlimited access to money in the machines - the network could not check that there were funds available to cover the withdrawals.

The credit union - whose membership includes government employees and health care workers - is like a bank, which does not make a profit.

Its members then overdrew their accounts - some by nearly $20,000.

The 4,000 people being investigated all withdrew more than $1,000 from the credit union - which continued allowing money to be taken from cash machines in the belief it was helping its 300,000 members during a traumatic time.

Once the computer problem was discovered and resolved, the credit union began tracing the withdrawals - but only a small number of people agreed to pay the money back.