Cyberthreats stem from the malware, but monetary losses stem from money mules. I've decided to coin a new term: eFraud. I cannot think of a better way to describe the wave of fraud incidents the financial industry is facing. It's electronic.
NACHA's CEO says ACH-related fraud is often over-hyped, and occurs far less often than check- and payment card-related fraud. But when corporate accounts are breached, fraudulent ACH transactions lead to big financial losses.
"I am hoping for some turn around, but overhang in troubled real estate, unemployment and debt levels are negatives," says Christie Sciacca, former FDIC official.
Here's a New Year's resolution every banker can appreciate: In 2011, the industry must embrace a stronger dedication to investments in fraud-detection and prevention.
There have been 58 reported banking-related data breaches so far in 2010, according to the Identity Theft Resource Center -- slightly fewer than the total of 62 breaches in 2009.
2010 Timeline of data breaches involving U.S. financial institutions. See the type of breaches, when they occurred and how many records were compromised.
"Many institutions only know about fraud when they get notified by the customer, and that is not indicative of an industry that is really trying to address the problem." George Tubin, TowerGroup
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