According to the regulator’s Financial Risk Outlook 2006, to be
published on Wednesday, half of active internet users are
'extremely' or 'very' concerned about the potential fraud risk of
making an online transaction.
A survey carried out for the FSA by NMG Financial Services
Consulting/IPSOS, shows that consumers who conduct their banking
online are taking steps to protect themselves against fraud, by
installing security software on their PC, but over a quarter do not
know when they last updated their software or update it
infrequently.
Five percent of online bankers have no security software
installed on their PC at all. The most common reasons cited
include that it is too expensive, that they don't need it or they
don't understand what it is.
Many banks' terms and conditions reflect the voluntary Banking
Code. The current edition, published March 2005, tells users to use
up-to-date anti-virus and spyware software and a personal
firewall.
But the FSA found that nearly all users (95%) surveyed believe
that at least some security responsibility should lie with the bank
while 45% believe banks should take sole responsibility.
According to APACS, the UK payment association, fraud losses
through internet banking were £14.5 million in the six months to
June 2005. Although this is relatively low, losses have more than
trebled since the same period in 2004 (£4 million). The FSA's
research found that if banks were to tackle these losses by
shifting the liability fully towards the consumer, more than three
quarters (77%) of users say they would abandon internet
banking.
“Most consumers recognise they have some responsibility for
security but they are not necessarily following this obligation
through,” said Philip Robinson, Financial Crime Sector Leader at
the FSA. “To tackle the losses associated with fraud, banks should
continue to drive security and this must include educating
consumers on the importance of protecting themselves.”
"We recognise that many banks are already taking steps to engage
consumers. Initiatives like the 'Get Safe Online' campaign between
the Government and the private sector show consumer education is
beginning to happen. But banks need to look carefully at consumer
attitudes and whether their initiatives are effective in
maintaining confidence," he added.
