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By: Jerome Brookshire

A sweeping fraud scheme targeting New York City’s Summer Youth Employment Program (SYEP) resulted in the illicit withdrawal of an estimated $17 million over a span of just three days earlier this month, sources told The New York Post. The stolen funds, which were meant to compensate tens of thousands of young New Yorkers participating in the city-sponsored work initiative, instead vanished into the hands of scammers who manipulated a critical flaw in the program’s payment system.

The scam, now under active investigation by the NYPD and the Department of Youth and Community Development (DYCD), reportedly unfolded between July 11 and July 13, with ATMs across the five boroughs being systematically drained. According to the information provided in The New York Post report, the fraud exploited NYC-issued debit cards linked to SYEP participants — cards intended to deliver modest weekly wages to teenagers and young adults for their work during the summer.

Ordinarily, these debit cards allow young workers to access several hundred dollars per week, the result of minimum-wage pay for up to 25 hours of work. But a “processing error” allowed some cards to bypass safeguards, accessing unusually high cash amounts — with single cards reportedly used to withdraw up to $40,000 from ATMs in a matter of minutes.

The New York Post reviewed social media videos, including posts on TikTok and Instagram, where individuals openly boasted about exploiting the glitch. One user filmed himself declaring, “We’re making bread, we’re printing money right now. If you work S.Y.E.P., hit me up.” Others, however, issued warnings not to fall for what they described as a dangerous scam.

Though the magnitude of the heist has alarmed city officials, DYCD spokesman Mark Zustovich emphasized to The New York Post that “no taxpayer dollars have been lost,” though it remains unclear who is ultimately absorbing the financial loss. The Post noted that the payment system used by SYEP is operated by third-party vendors, and roughly 30,000 of this year’s 100,000 program participants received pay via the NYC-issued cards rather than through direct deposit.

Zustovich stated that DYCD is “deeply disturbed by scammers preying on our participants just as they started their work assignments to support themselves and their families.” He added that the agency “quickly launched an investigation with the vendors who oversee the SYEP pay card system, to make sure our participants’ earnings are as secure as possible,” while also working to educate program members about fraud and financial security.

Details of the scam’s execution, as well as the number of cards compromised, remain under investigation. Investigators are currently attempting to trace the breach’s origin and determine whether it was an inside job, the result of external hackers, or a combination of both.

One of the vendors involved, ATM World Corp., told The New York Post via a statement also shared with ABC-7 News, that their machines were used to process dozens — sometimes hundreds — of consecutive withdrawals by a single cardholder. “There was a $200 limit per transaction, but no limit on how many one could make or how much cash one could take out,” explained ATM World CEO Youserf Mubairrez. “Sometimes it was five to 10 transactions. A few times we saw 100 to 200 transactions consecutively.”

That lapse in transaction limits may have been a key vulnerability that enabled scammers to bleed machines dry using cloned or compromised cards. While the city’s standard banking protocols should have flagged such anomalies, the lack of automatic halts or alerts appears to have given the perpetrators a significant window of opportunity.

The Summer Youth Employment Program, considered the largest publicly funded youth jobs program in the country, provides work experience, skill-building, and wages to thousands of New Yorkers between the ages of 16 and 24, many of whom come from low-income or minority communities. The New York Post report noted that participants without bank accounts have been receiving pay via debit cards since 2003, a system that has generally functioned smoothly — until now.

With public confidence shaken and participants alarmed, city officials and vendor partners face growing pressure to implement enhanced security protocols and provide restitution where appropriate. One pressing concern, according to The New York Post report, is whether any legitimate SYEP workers have had their earnings frozen or compromised as part of the investigation or amid card deactivations.

Zustovich emphasized to The Post that DYCD continues to monitor the situation closely and is committed to safeguarding participants’ wages. “Our goal,” he said, “is to ensure that young people in the program are paid promptly, securely, and fairly.”

As law enforcement delves deeper into the origins of the multimillion-dollar breach, one thing remains clear: the high-profile scam has not only exposed glaring vulnerabilities in a vital city-run program, but has also left a trail of unanswered questions that city officials are racing to resolve.