We use cookies to provide you with a better experience. If you continue to use this site, we'll assume you're happy with this. Alternatively, click here to find out how to manage these cookies

hide cookie message
 
74,944 News Articles

Lost child benefit discs to cost banks £250m

Banks counting the cost of UK data breach

Last week's loss of computer discs containing bank details and other personal records for 25 million people could cost UK banks £250m, according to research firm Gartner.

Gartner analyst Avivah Litan said that's how much banks will have to fork out to secure people's accounts by closing and reopening them in an effort to prevent ID fraud. The figure is based on a conservative estimate of £10 per account.

HM Revenue & Customs last week disclosed that it had lost computer discs containing large amounts of confidential information, including names, addresses, dates of birth and bank account information belonging to nearly a quarter of the country's population.

The huge media attention the breach has received makes it much more likely than normal that the stolen data could actually get misused, Litan said. As a result, UK banks are also much more likely to take emergency measures to mitigate that risk.

Heightening the concern is the fact that fraud resulting from compromised bank account information is often harder to detect than payment card fraud, Litan said. Typically, bank account compromises can result in account hijacking or so-called automated clearinghouse fraud, where a data thief uses compromised bank account and routing numbers to initiate payments from a customer's account to his own, she said.

Detecting such transactions can be hard, especially given the scale of the recently disclosed breach, Litan said. At the best of times, "probably the system with the weakest protections against fraud is the account transfer system" between banks, she added.

Related articles:

UK Child Benefit discs 'stolen' says con legend


IDG UK Sites

Samsung Galaxy Note 4 release date, price and specs 2014

IDG UK Sites

What's the best smartwatch? 11 iWatch rivals compared in our wearables round-up

IDG UK Sites

25 Years of the World Wide Web: Happy Birthday, Intenet

IDG UK Sites

Developers get access to more Sony camera features