TAIPEI (AFP) - Taiwan has arrested three foreign suspects over a US$2.5 million (S$3.4 million) cyberheist in which malware was used to hack into a major local bank's ATM network and bags of cash were stolen, the police said on Monday (July 18).

The attack, the first of its kind in Taiwan, targeted the First Commercial Bank's ATM network last week, using malware to withdraw more than NT$81 million (S$3.4 million) from dozens of machines in three cities.

A Latvian suspect, identified as Andrejs Peregudovs, was arrested by police in the north-eastern county of Yilan after being spotted by an off-duty police officer from Taipei who was on holiday in the area.

Two other suspects from Romania and Moldova were arrested on Sunday at a hotel in Taipei, the police said, adding that they believed the heist was carried out by a 16-member international crime ring.

"This is the first ATM theft by a foreign crime ring" in Taiwan, the police said in a statement.

The police have recovered more than half of the stolen money, but warned that 13 of the suspects - including five Russians - had fled Taiwan after the heist.

"We will continue to search for the rest of the stolen money to let international hackers know that Taiwan is not a crime haven," the statement said.

The police have sought assistance from both Interpol and Russia's de facto embassy in Taiwan.

Surveillance images released by the bank showed masked robbers working in two-man teams targeting 41 ATMs belonging to the First Commercial Bank in three cities.

It is not clear how the thieves installed malware on the ATMs, but within five to 10 minutes, the thieves were seen walking away with bags full of stolen cash, the bank said.

After the theft was discovered, more than 1,000 ATMs of the same type targeted in the heist were shut down by banks nationwide.