Recent Banking Code Report Puts Online Banking Losses Liability in the Hand of Customers

Online Banking Customers May be Responsible for Losses on Their Account

(29.04.08) - Finjan has warned that according to the 2008 Banking Code report online banking customers may be responsible for losses on their account if they don’t keep their PC secure and if they don’t use using up-to-date anti-virus and spyware software and a personal firewall. Under the code, these acts could be seen as "acting without reasonable care” by the customer.

"The new code, specifically sections 12.9 and 12.11, places the onus on bank customers to take reasonable care and make sure that their anti-virus and anti-spyware software are up-to-date. If not, they might be hold responsible for losses on their online banking account," said Yuval Ben-Itzhak, Finjan's CTO.

According to Ben-Itzhak, the new approach in dealing with online banking fraud potentially gives the banks a position to reject online fraud claims upfront.

"This means that specifically business customers of banks should take steps to review their IT security arrangements and ensure that they have the needed solution to protect their IT resources," he said. Unless business customers adopt this approach to IT security, Ben-Itzhak said, they might face an uphill battle in recovering their funds if they go missing in the event of electronic fraud. "And with companies typically holding thousands of pounds in their bank accounts, the ramifications of an electronic fraud are extremely serious," he said. (Finjan: ma)