Research revealed the banks’ websites could be ‘spoofed,’ allowing online criminals to steal the details of user identities. With identity theft an increasing concern within the financial services sector, Cahoot, Bank of Scotland and First Direct confirmed that they were all in the process of reviewing and updating their website security.
As part of its drive to highlight and eradicate financial crime, the Financial Services Authority (FSA) in its ‘Financial Crime Newsletter’ also revealed its concerns over identity theft. However, it indicated that this often clouded the greater issue of money laundering.
The FSA stated that website checks needed to provide a reasonable level of certainty that users were who they said they were, but admitted that checks needed to be proportionate in terms of time, inconvenience and expense, to the firm and the customer.
Commenting on the systems currently used within the financial services sector, Simon Webster, managing director at Facts and Figures Financial Planning, said: “The current system of usernames and pass words is archaic. In the financial services industry, digital certificates, which are downloaded from a central website by an adviser, give easy access to many professional systems.
“I don’t understand why banks don’t adopt this cheap and easy way of protecting against identity theft and saving customers hours of frustration.
“However, using financial institutions’ online services is probably safer than using their paper-based transactions, as sensitive data is often not shredded properly before it is disposed of.”
