Reforms needed to prevent Internet fraud

by Gill Montia

Story link: Reforms needed to prevent Internet fraud

The House of Lords has been reviewing Internet security and has issued a warning to online shoppers and bankers in a report by its science and technology committee.

The Committee accuses ministers, Internet service providers and software manufacturers of a “laissez faire” attitude to Internet security, which is encouraging criminals engaged in fraud.

The report maintains that thousands of credit card details, along with passwords, addresses, dates of birth and mother’s maiden name, can be purchased for less than £1 each.

It also criticises the Government for insisting that online fraud should be reported to banks rather than the police and warns that those responsible for Internet fraud now include sophisticated organised groups, many of which are based in Eastern Europe.

The committee recommends that software firms should be liable if their customers fall victim to e-criminals, and that the banks should be made legally liable for the losses of their online customers.

It wants the Government to create a central system for reporting e-crime, whilst also establishing a standard for secure Internet services and providing additional resources for police investigation of such crime.

Losses from online banking fraud stood to £33.5 million in 2006, a substantial increase from the 2004 figure of £12.2 million.