NORWICH — Town officials say Norwich will recover almost $80,000 of the money it lost to an email scam that targeted municipal coffers this summer.

“That’s extremely good news,” Selectboard Chairman John Pepper said in a CATV recording of Wednesday’s Selectboard meeting. “I think it’s positive in light of the loss we thought we were facing last week.”

Talks are also underway to secure the roughly $170,000 still missing to the scam from Norwich’s insurer, the Vermont League of Cities and Towns. Town Manager Herb Durfee said last week that attorneys might be called on to assist with that insurance claim.

The Selectboard earlier this month said it lost $249,720 through a “business email compromise scam.” The emails were designed to look like they came from Durfee and prompted the town finance department to make the payments.

Between Aug. 6 and Aug. 23, four transactions siphoned money from the town in violation of existing procedures, the Selectboard wrote in an Oct. 2 statement.

The loss, which accounted for more than 5 percent of Norwich’s $4.25 million budget, kicked off two investigations — a criminal inquiry conducted by the U.S. Attorney’s Office and an internal review.

The Selectboard said it uncovered a series of separate transactions apart from the scam that occurred without its approval, although there is no evidence “that would suggest that any of these payments were made fraudulently,” the statement said.

After the investigation began, Norwich Finance Director Donna Flies was placed on paid leave. She started the job on July 1 when longtime Finance Director Roberta Robinson retired.

Town Treasurer Cheryl Lindberg said last week that $79,765 was recently provided by a bank that held the potential scammer’s account. She declined to name the financial institution, saying such a disclosure could interfere with ongoing investigations.

Lindberg, who worked as a professional accountant and has held the elected treasurer’s position for 23 years, said she’s now the only person with access to Norwich’s bank accounts and is assisting with payroll and financial transactions.

Once the fraud was detected in August, “I immediately shut down all banking abilities by anybody working in the finance office,” she told the Selectboard. “That was done immediately as possible so nobody had the ability to do anything further.”

Meanwhile, the Selectboard is exploring additional ways it can protect the town against future scams or incursions.

Another review to be conducted by the Vermont League of Cities and Towns later this month will document how the town’s finances were scammed and recommend a course of action to prevent future problems.

Durfee, the town manager, said a cyber security review will soon look into whether any of Norwich’s computer systems harbor malware or a backdoor that could lead to more losses.

“We’re trying to continue to evaluate our overall system with regard to that,” he said.

Questions at the Selectboard meeting also were directed at Mascoma Bank, which holds the town’s accounts. Officials from the bank said it offers services that would alert someone to large, unusual transactions for approval.

The bank rolled out such services about three years ago to prevent cyber crimes, according to Scott Young, Mascoma’s chief retail officer, who didn’t know why the town hasn’t yet signed on.

Tim Camerato can be reached at tcamerato@vnews.com or 603-727-3223.