Written by Peter Warren
SOPHISTICATED online fraud, known as ‘phishing’, has cost UK financial institutions at least £60m. Attacks are said to have cost three large British firms £20m each in compensation for defrauded customers and in upgrading their internet security. The figures dwarf the previous £1m estimate for the amount phishers have cost British banks, and show that the problem is exploding to epidemic proportions.
The websites of Barclays, Nat-West, Lloyds TSB, Halifax, Nationwide, Citibank and MBNA and online market place eBay have been targets of this new fraud. Experts fear UK supermarkets will be the next target.
At least one British-based gang is believed to be launching phishing attacks. However, the main culprits are criminals in Eastern Europe, with Romania suspected to be the world phishing headquarters. It is thought four or five main gangs are responsible for most of the more high-profile frauds, and estimates suggest that 5% of all emails now sent may be phishing attempts.
The fraudsters use random emails that direct recipients to what appear to be the websites of reputable financial institutions and ask them to reveal account details, passwords and PIN numbers for cash machines. In fact, these are spoof websites set up by the criminals to steal banking details.
Most people ignore the mail because they are suspicious or because they do not have an account with that organisation. But a small minority reveal their account details, and in some cases have lost thousands of pounds.
Police believe the gangs are recruiting technology and language specialists to improve the quality of their bogus sites and mail.
‘The emails are getting better in content and much more convincing,’ said Tony Neate, the National High-Tech Crime Unit’s industry liaison officer.
‘In the past, the spelling was awful and they were mis-spelling key words – now you can believe the email when you receive it. If people get an email from a bank or retail outlet, they should subject it to checks and not click on the link.’
The problem for banks and retailers is that, as well as being costly, the scams erode public trust in e-commerce.
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Published by London Evening Standard 29th of April, 2004
