[ news_security_news ]
Banks Ranks In ID Fraud Protection
John Stith
Staff Writer
2006-01-11
 Security News RSS Feed
The year 2005 turned out to be a very rough year for identity fraud and banks in particular. Literally millions of identities were compromised from financial institutions and entities both big and small. A new study was just released ranking the top institutions in their efforts to fight identity fraud.
The report, called the Online Banking Safety Scorecard ranks 28 leading banks on their consumer-facing online identity fraud Prevention, Detection and Resolution capabilities or how well they can protect consumers as well as letting consumers protect themselves.
Javelin Strategy and Research conducted this study for the second year and came up with some interesting findings.
While financial institutions see the value in and continue to move towards implementation of security solutions aimed at prevention and detection of identity fraud, many still primarily emphasize after-the-fact resolution of identity fraud.
For example, almost all of the banks surveyed (96%) offer zero liability policies to account holders -- not holding customers liable for any funds stolen as a result of identity fraud. However, none of the surveyed banks are allowing users to limit or prohibit international or online transactions. Javelin's research has found that more focus on the prevention and detection of identity fraud will likely result in fewer losses and greater efficiencies.
Javelin used a combination of online review and direct mystery-shopper research to score banks on a 100-point scale that included 28 consumer-facing capabilities that banks could implement. The survey took into account the most promising mechanisms that banks can employ for online consumer protection, based on Javelin's extensive research on the causes and remedies of identity theft and fraud.
While banks have significantly improved their customer education capabilities, none yet offer email alerts of changes to credit bureau information, an important indicator of new account identity fraud that nearly half of all online households indicate that they would value. Most banks have yet to implement stronger authentication as well as customer-driven alerts regarding changes to personal information, balance transfers and unusual account activity.
Research data clearly shows that industry bears the great majority of net costs from fraud, which acts as a motivator to increasing customer safety. The following banks topped the list of best performers on Javelin's latest Identity Fraud Safety Scorecard:
1. Bank of America
2. Citibank
3. E*Trade Bank
4. Washington Mutual
5. Wells Fargo Bank
This is some interesting information considering several of these were targets of major security breaches earlier in the year. As the study points out, they are improving but there is still much to do to improve the state of online security and identity fraud.
About the Author:
John is a staff writer for SecurityProNews covering cyber security.
More news_security_news Articles
Security News RSS Feed
|
|
RSS
Archive
Contact Us
Advertise
