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BANKING TECHNOLOGY | Cesar Tordesillas, Korea
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Korean banks to be accountable for phishing

Start being responsible for online security.

This is the message of South Korea’s Financial Supervisory Service to banks who are lax on securing their online systems.

This exposes bank customers to that are easily exposed to phishing crimes.

It is currently reviewing related laws to reduce exemption grounds made for banks in terms of making compensation.

The current law exempts banks from phishing and simply blames the victim’s negligence.

Over 12,800 voice phishing cases were reported between January 2011 and September 2012, for damages worth over $139.4 million.

“Voice phishing crimes started when customer information leaked out. So financial institutions are fundamentally responsible for the crimes,” said Baik Seong-jin, head of the Korea Finance Consumer Association.

Banks have not made significant efforts to help reduce such crimes so far, while local card companies last year paid out about 40 to 50 percent of the damages to phone fraud victims and strengthened identification procedures as well.

“We are examining the card companies’ system to see if it can also be adopted by banks,” said an FSS official.

Local banks, however, are gearing up to resist the measures.

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