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Online bank fraud on the rise

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Worrying figures from the Financial Services Authority (FSA) about Internet banking UK have led to a warning from the financial watchdog that the problem could get out of control.

In a statement to the House of Lords, the FSA said that it was “extremely concerned” about the relentless rise of ‘phishing’, the practice of luring people into revealing their bank account details via fake websites. Although the amount of money actually stolen from UK current accounts is still small, it is set to go up 90%

There were 312 phishing incidents between January and June 2005, the Lords science and technology committee was told. The figure for the same period this year was 5,059, a rise of 8,000% and a serious threat to Internet banking UK. The actual amount of cash stolen in the first half of 2006 was £23.2m and was likely to be £22.5m in the second half of the year.

The increase in the figures was attributed to better detection, according to Apacs security boss Philip Whitaker. He also told the peers that the criminals behind the scam were becoming ‘industrialised’ in their approach and scale of operation.

When it came to the question of which banks were the most vulnerable in the Internet banking UK sector, Whitaker replied: “There is no evidence that one bank is any worse or any better than another. In the grand scheme of fraud, phishing is still very much on a small scale.”



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