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Slack bank practice creates opportunity for phone phishing scams

A question of authentication

Combat fraud and increase customer satisfaction

Opinion There is a scene during the underrated '70s conspiracy thriller Three Days of the Condor when Robert Redford's bookish spy is asked to verify his identity when calling into base. He resists, insisting that the person who took his call needs to verify their own identity before he gives anything away.

Authentication ought to work both ways, a point that applies just as much to banking in everyday life as it does to spies and spymasters in the world of fiction. However this point is somewhat lost on some banks, whose employees sometimes call consumers out of the blue and go through a list of security questions without verifying beforehand their own bona fides. This is a problem, because fraudsters might use much the same approach to extract sensitive information.

This principle is well understood in theory but often overlooked in practice, as the experience of one of our readers (who wishes to remain unnamed) illustrates.

"I have been contacted twice recently by companies [E.On and Moneyway] who called my phone, and then asked me to provide "security details". Now in my book, if YOU call ME, then YOU need to prove who YOU are, not vice versa. And this is something that people need to be aware of, because it's the classic prelude to a phone-phishing scam," he writes.

"Clearly these companies feel it is acceptable to call people up and ask for security details. My concern is that if it becomes widespread, then vulnerable people – particularly elderly folk, who like a chat – could fall prey to organised tricksters who elicit enough detail to perpetrate a fraud."

Our correspondent suggests that Ofcom might want to draft a code of conduct about this. However this is somewhat outside the remit of the telecoms regulator, especially when it comes to enforcing the code.

Reg staffers have had mixed experience in this area. At least one has had similar experiences to our anonymous correspondent.

However another, when he challenged the representative of his bank to authenticate themselves, was given a reference number and asked to call back at a number available on his bank's website, a good practice many other financial institutions would do well to adopt. ®

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