As we move from branch banking to digital banking, worries move from branch looting to account hacking…

Banking and its security breakers have a Tom and Jerry relationship. The banks keep looking for new ways to increase security and the breakers keep looking for new ways to break the same.

This article argues how one third of accounts of a British small bank have been hacked recently. It also highlights how the issues are not limited to small banks but for larger entities as well:

We’ve seen some pretty strong attacks on banks cyberdefences in the past year. Three major incidents in the SWIFT network; 50 at the Federal Reserve; problems at the Bank of England and many other central banks; a major incident at the Danish payment processorNETS; and big banks like HSBC and JPMorgan have all been affected.

Admittedly, most of these are DDoS – Distributed Denial of Service – attacks, which bring down websites but not banks, yet that’s just the tip of the iceberg.  After all, it used to be that thieves would rob bank branches as that’s where the money was; now, they rob bank servers because that’s where the money is.

These incidents of cybercrime are often unnoticed however, as banks are loathe to go publish and say they were hacked … but one did just that this week.  Tesco Bank.  A hacker got into the bank and compromised 40,000 of their 136,000 accounts.   That’s a third.  Of those compromised, the bank originally thought that 20,000 had been hacked with money taken, bvut it turns out it is 9,000 who lost £2.5 million ($3.2 million).   Even so, the bank had to shut down their internet banking service to all customers for several days, whilst they sorted out the mess, and suspended all online debit card and contactless card transactions.

That is seriously worrying for a bank’s reputation.  They’ve promised to reimburse all customers who were impacted, but to openly say they were hacked is not good for the image.

He says one solution is for the banking industry to cooperate and evolve more robust cybersecurity standards.

But the jerrys will soon figure whatever Tom (or Toms) does and rob the cheese.  This hacking will be a huge concern going ahead across banking. Basically it is the age old relation which is not changing. The medium is changing from robbing branches to hacking accounts on a digital platform.


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