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18 February 2016

Beyond Butch Cassidy

From major simulation exercises to new technology, the British banking industry is working to keep on top of cyber robbers

By Anthony Browne

The way we bank is being radically changed by technology. The take-up of online banking, for example, has been huge, with people in the UK moving a billion pounds a day online. The number of mobile apps being downloaded is doubling each year. This is great news for customers and businesses, who now have more ways to do their banking than ever before.

For the tech-savvy customer, new ways of banking have made life easier. The downside is that, in parallel, tech-savvy criminals now have new and different ways in which to try and steal your cash.

Just as some aspects of banking, such as postal orders, are steadily becoming a thing of the past, so too are former staples of financial criminal activity, such as bank robberies. There were just 89 bank robberies in the UK last year, compared to 693 just two decades before – a fall of nearly 90 per cent.

If Butch Cassidy and the Sundance Kid were alive today, they would more likely be tricking people to send them money out of their account through a boiler-room rather than telling people to “stick ‘em up” in the wild west.

So as criminals work out new ways to get their hands on people’s money, the banks are working to build new defences in order to keep that money safe. The government estimates that each year the banking industry spends more than £700m annually fighting cyber criminals.

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This investment goes toward researching, developing and launching new technology. One of the most well-known has been the introduction of chip and pin technology, which has reduced card fraud. Anti-virus and browser technology keeps your online account safe, and most banks require you to tap in extra security details on a separate authentication device when you make a new payment to someone through your online account.

As banks strengthen their systems, criminals increasingly target what they see as the weak link in the chain – the customers. This criminality often takes place through “social engineering”; such as trying to befriend people online or on the phone and attempting to trick people into parting with their money. This is known as vishing or phishing. Our latest consumer research has found that over eight million people could be susceptible to these sorts of scam.

 So what are banks doing to address this? One method is offering “self-protect” prevention advice through the bank’s own websites and through bodies such as the BBA. We recently developed an information campaign called “Know Fraud No Fraud” which outlines the “eight things your bank will never do” – such as asking you to transfer your life savings into a new “safe” account.

But it’s not just individual customers who are being targeted – the UK banking industry itself is regularly targeted by hacktivists, criminal gangs and even governments of other countries. Many are looking to expropriate funds, stop the bank’s systems from working or to steal valuable customer data. As geo-political tensions grow, so too does the threat we face.

The London banking centre is one of the biggest targets. Thankfully, due to the hard work of the banks, law enforcement agencies and the UK government, we are also one of the countries that is best prepared to withstand these attacks.

The Bank of England is taking this very seriously – indeed, it has run a number of “war games” simulating what a major attack might look like, known as the Waking Shark exercises. The industry is working closely with the National Cyber Crime Unit and the UK’s new computer emergency response team (CERTUK) to develop responses to the latest threats. The BBA is also about to launch a new Financial Crime Alert Service that will allow government bodies, law enforcement agencies and financial institutions to share intelligence.

The fight against crime is not a new one, but banks are increasingly finding themselves on the front line. There are now tens of thousands of people working in banking whose job it is to fight crime on a daily basis.

We won’t always be able to prevent every cyber-attacker and scammer, but we can work hard to make sure we’re putting these modern Butch Cassidys out of business.

Anthony Browne has been chief executive of the British Bankers’ Association since 2012

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