Banks ‘keeping quiet over cyber attacks’

BANKS are deliberately not reporting cyber attacks to authorities, experts have said, as MPS called for branches to be forced to disclose their record on protecting customers from scams.

The number of security breaches in the financial services industry has increased, but banks are still not admitting the full extent of the problem, said the Financial Conduct Authority (FCA).

Banks have previously been reticent to admit attacks because of fears about their image or about penalties for failing to protect customers.

Now a powerful group of MPS is calling on the industry to be forced to reveal its record on protecting customers from falling victim to fraud.

The public accounts committee also warned banks they must return £130million belonging to fraud victims currently held in frozen accounts.

MPS said big banks were not doing enough to tackle a £10billion online financial crime surge, or to help victims.

The cross-party committee said banks should follow a minimum set of standards to protect customers and publish the results so people can choose where to put their money.

Excuses from industry heads that publishing such information would put people at risk as scammers would know where to target is not a good enough excuse for inaction, it said.

Megan Butler, the FCA’S director of supervision, warned that banks are still not admitting the full scale of cyber attacks carried out every day.

“Our suspicion is that there’s currently a material under-reporting of successful cyber attacks,” she said.

The number of successful attacks has risen from five to 49 annually between 2014 and 2017, according to the FCA.

Currently, between 40 per cent and 70 per cent of victims never get their money back.

But MPS said the true extent of the problem was not known because only around 20 per cent of incidents were reported to the police because people were embarrassed. The study states: “Banks do not accept enough responsibility for preventing and reducing online fraud and there is no data available to assess how individual banks are performing.”