by CIO Staff

U.K. Web Banking Fraud Up Dramatically

Nov 08, 20062 mins

U.K. banks reported a 55 percent increase in losses from fraudulent online transactions for the first half of the year, mostly from phishing scams, an industry trade group reported Tuesday.

Losses totaled 22.5 million pounds (US$42.8 million), up from 14.5 million pounds from the first six months of 2005, according to the Association for Payment Clearing Services (APACS).

The loss figure isn’t broken down by individual financial institutions. APACS’ 31 members, including HSBC Bank and Barclays, account for about 97 percent of bank and credit-card transactions within the United Kingdom.

The figures underscore continuing problems with phishing, where criminals try to capture financial details through fraudulent e-mails and sophisticated fake banking websites. Account numbers, log-ins and passwords are often then sold online to other fraudsters who try to turn them into profit.

More than half of consumers who shop online don’t verify that e-commerce sites are using a secure connection, often shown by an “https” in the URL or a padlock in the Internet Explorer browser, APACS said. In the United Kingdom, some 26.5 million people undertook an estimated 372 million online transactions in 2005, the organization said.

APACS did have some good news. Phone, mail order and Internet fraud increased by 5 percent overall, but that growth was markedly slower than the 29 percent jump between the first half of 2004 and the first half of 2005. APACS put the total loss from January to June this year at 95.3 million pounds.

-Jeremy Kirk, IDG News Service (London Bureau)

Related Link:

  • Survey: E-Crime More Frightening than Muggings

Check out our CIO News Alerts and Tech Informer pages for more updated news coverage.