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Modest Phishing Losses, Yet Worrisome

'The Financial Services Authority' (FSA) has reported that in the past two years, the United Kingdom has experienced an 8,000% rise in 'fake Internet banking scams' or 'phishing'. FSA said it was extremely worried about this growth. phishing essentially relates to using fake websites to spoof people into disclosing their bank account details.

Rob Gruppetta of the 'FSA financial crime team' told the parliamentary committee that they were 'very concerned' about the increasing rate of phishing. It has risen by 8,000% in the previous two years, yet in the gamut of total fraud it is very small, he said.

Losses from phishing are estimated to be modest in comparison to other kinds of financial frauds. However, banking security experts speaking before the 'House of Lords science and technology committee' have shown concern about the growing proliferation of scams created to cheat consumers into surrendering their online banking credentials.

People asked Sandra Quinn of APACS, the 'U.K. Payments Association' that given the increase in online banking fraud by 90% to 23 million pounds in 2005, what was the amount of loss accruing to banks due to Internet fraud. They also asked her if such growth in fraud would continue.

Mrs. Quinn replied that the association had figures for the first half of 2006 and it stood at 22.5 million pounds. She expects it would not rise as much as in 2005. But it wouldn't be an unnoticeable rise. And therefore, it is still a matter of concern.

APACS reports that a certain bank is a favorite target of 'phishers'. It did not reveal the name of the bank for discretionary reasons, but pointed that the bank doesn't have weaker security measures than the rest.

The FSA report showed that the phishing scam figures recorded between January to June of 2005 and 2006 were 312 and 5,059 respectively.

On the whole, the FSA report makes one conclusion - phishing is a recognized practice and it is not going to fade away soon. However, the increase in alertness by 'Internet service providers' and the use of anti-phishing products indicate the increase in enhanced protection for Internet users.

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