Online Banking Fraud On Tthe Increase

The internet is becoming an increasingly significant venue channel for fraud, according to research released on 10th March 2010 by The UK Cards Association. In fact, whilst total fraud losses on UK cards and cheques fell last year, there was a 14% rise in online banking losses.

Through initiatives like Chip and PIN, UK card fraud fell by 28% to 440.3 million GBP in the 2008-9 period, whilst cheque fraud fell from 41.9 million GBP in 2008 to 29.8 million GBP last year. Meanwhile, reported cases of card cloning fell by over half in the same period.

However, 59.7 million GBP was lost through online banking fraud in 2009 - a 14% rise on 2008. This increase can largely be attributed to cases of customers falling victim to malware and phishing scams, with 51,000 phishing incidents being reported last year, up 16% on the year before.

Phishing is the practice of sending an email that claims to be from a trustworthy source like a bank, but is in fact fraudulent. The email will entice the recipient to click through to a website, such as an online bank, that appears to be authentic and enter their 'login' details. These details are then passed on to fraudsters who can then access and potentially clear a person's bank account. Phishing scams may also elicit information such as a person's passport number in order to commit identity fraud, so it is important to remain vigilant at all times, checking domain names carefully before parting with personal information.

Fraudsters also use malware as a means of extracting the information that they need from computer users. They will direct a user to click through to a webpage where viruses and Trojans will be downloaded onto a user's machine as soon as the page is visited. Malware not only damages a computer, but also leaves it vulnerable to hackers who can access or even take control of a computer in order to steal the sensitive information stored on it. To protect against this, computer users should ensure that they have the most up to date antivirus and firewall software installed and running on their PCs at all times.

In the work environment, managers can help avoid potentially devastating security breaches by making employees aware of how to spot common scams and what to do to avoid becoming a victim. For example, a bank will never ask a user to confirm personal details via email, so any such request should always be assumed to be fraudulent.

Ultimately, while computer forensic experts can gather evidence and even track down perpetrators, the damage may already be done in terms of reputation, downtime and financial loss, so as ever, preparation and vigilance are the most powerful tools computer users have in the fight against online fraud.