Internet banking frauds on the rise

‘Complaints relate to transactions involving phishing, compromise of security information’

In a new trend, there been a rise in the number of complaints relating to fraudulent Internet banking transactions to the Banking Ombudsman, Andhra Pradesh, during 2011-12.

Complaints

Disclosing this at a press conference here on Thursday, Chief General Manager, Reserve Bank of India and the Banking Ombudsman, M. Sebastian, said the complaints related to transactions involving phishing and compromise of security information. With mobile phones being increasingly used for transactions, instances have been reported of fraudsters intercepting one-time passwords by obtaining duplicate SIM cards.

He said that because of certain vulnerability on the part of mobile operator, the fraudsters were impersonating and obtaining duplicate SIM cards. He said that 40-50 complaints were received during 2011-12.

Mr. Sebastian urged the banks to take up the issue with mobile operators. It would also be brought to the notice of Telecom Regulatory Authority of India (TRAI) by the RBI.

Emphasising the need for customers to be more careful, he said there should be a minimum three levels of checks.

The largest chunk of complaints (29.22 per cent) related to ATM/Debit Card/Credit Card disputes.

The complaints were about failed ATM transactions, fraudulent (POS-point of sale) transactions over Internet using debit card information and harassment in collection of credit card dues.

A significant number were on disbursement of Central government pensions (9.3 per cent) and operations in deposit accounts (8.3 per cent).

He said that as many as 5,267 complaints were received during 2011-12 as against 5012 the previous year.

Of them, 5108 were disposed off.

Mr. Sebastian said SBI and Associates, including SBI cards accounted for the largest share ( 47.2 per cent). Public sector banks as a class accounted for 72 per cent of the complaints.

The complaints in respect of nationalised banks, foreign banks, new private sector banks and RRBs declined by 13.71 per cent, 29.12 per cent, 4 per cent and 7.35 per cent respectively.

Meeting today

Mr. Sebastian said a committee constituted by RBI to improve the Banking Ombudsman Scheme would meet at Mumbai on Friday.

The need to increase the pecuniary jurisdiction of the Ombudsman (currently up to Rs.10 lakhs) and for every bank to have its own ombudsman would be discussed.