Internet banking quite secure, never been infiltrated

By David Eames

New Zealand internet banking systems were secure and had never been infiltrated by hackers, a Westpac spokesman said yesterday.

Paul Gregory said no one had successfully hacked in to an internet banking system, but instead had to rely on tricking bank customers, or stealing information from them.

His comments came after reports claiming internet banking security could easily be undone by hackers.

Gregory said Westpac was aware of the problem and was looking at moving to two-step authentication procedures.

However, financial losses from internet fraud were "a fraction" the size of older scams, such as cheque fraud.

Having money stolen by a hacker in another country was impossible, as cash transfers from New Zealand bank accounts to overseas ones could not be performed over the internet in this country.

Gregory also believed internet banking customers might reject added security if it meant more inconvenience.

BNZ spokesman Zaman Toleafoa agreed.

Toleafoa said the BNZ had surveyed customers in an attempt to find a web-based banking system that was "safe for all, but easy for people".

"What [customers] have told us is that the power in internet banking is that it is easy ... they recognise the security is important, but if it becomes too hard, they might just choose not to use it any more."

However, he said the problem was increasing as authorities in other countries tightened security, forcing hackers to focus their attentions on more out-of-the-way places.

The BNZ is looking at several options for beefing up internet banking security, including moving to a two-step customer authentication process or modifying its existing one-password system.

One idea being considered is to have customers key in their passwords and PIN numbers via an on-screen keyboard, using a mouse.

This would defeat keystroke recording programmes.

Until a foolproof internet banking system was in place, said Toleafoa, customers should use their common sense.

Basic precautions included steering clear of public computers such as those in internet cafes, and ensuring personal computers were running the latest anti-virus software.

Installing a firewall on a personal computer was also a good idea.

The Opposition yesterday called on the Government to help ensure the integrity of internet banking.

National commerce spokesman Brian Connell said New Zealand’s 1.3 million internet bankers would be alarmed at the ease with which their accounts could be compromised.

The Government needed to take immediate action to see two-password security features became standard for internet-based transactions.

Information Technology minister David Cunliffe said the problem lay more with businesses such as internet cafes needing tighter security on their computers, rather than with the banks.

"In the first place, this is an area where you would expect banks to have a strong commercial imperative to get it right," he said.

The Government would keep an eye on the situation.


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