FBI Probing Electronic Theft of Tens of Millions of Dollars from Citigroup (NYSE: C)

The Federal Bureau of Investigation is investigating a hack on Citigroup’s (NYSE: C) network that led to the theft of tens of millions of dollars, according to a new report from the Wall Street Journal. In a defensive move, Citigroup vehemently denied the report.

Citing anonymous federal officials, the WSJ reported that a Russian cyber gang broke into Citigroup’s networks. The FBI also believes that two other computer systems, one of which was connected to a federal agency, was also attacked.

In a statement, Citigroup said “any allegation that the FBI is working on a case at Citigroup involving a breach of Citi systems resulting in tens of millions of dollars of losses is false. There has been no breach and there have been no associated losses.”

The WSJ said that the attack on Citigroup’s Citibank subsidiary was detected over the summer, however it may have occurred up to one year earlier. The FBI, NSA, DHS and Citigroup have allegedly worked together to investigate the attack.

Cyber crime is becoming an increasing concern to businesses and federal government as increasingly large financial transactions are taking place online. President Obama recently referred to cyber crime as one of the “most serious economic and national security challenges we face.”

President Obama announced the appointment of Howard A. Schmidt, a former eBay and Microsoft executive as the federal government’s coordinator for cyber security.

Tom Kellerman, a former member of the World Bank’s Treasury Security Team, said that attacks on banks are increasingly common. Kellerman said he had no knowledge of the Citigroup attack, but that large financial institutions are consistently targeted by criminal organizations in Eastern Europe, Brazil, and South East Asia.

“Ninety-eight percent of bank heists are now occurring virtually and not in the real world,” he said, adding that the industry is “hemorrhaging funds” as a result.