The Association Of Banks In Malaysia: Preliminary Investigations Reveal No Bank Staff Involved In Illegal Bank Account Withdrawals

Kuala Lumpur, January 5, 2009 – Preliminary investigations by member banks of The Association of Banks in Malaysia of illegal withdrawals from bank accounts, thus far, have revealed that no bank employee was involved in the activity of selling classified information to third parties.

ABM Chairman Dato’ Sri Abdul Hamidy Abdul Hafiz said severe legal action including termination of employment would be taken against any bank employee, if it was proven conclusively that there was such inside involvement in the illegal withdrawals.

“It is of the utmost importance that the public take comfort in the fact that the integrity of the banking system has not been compromised in any form or manner. Customers will be compensated if the security of the electronic banking system has been breached on the part of the banks. ABM is working closely with all the stakeholders including Bank Negara Malaysia (BNM) and the police to put a stop to short message system (SMS) and “phishing” scams targeting unsuspecting customers”, he said.

Banks also periodically forewarn the public of some of the common tricks employed by fraudsters so that customers are aware of what to look out for.

Dato’ Sri Abdul Hamidy said that banks have never ignored any complaint of an act with the potential to undermine public confidence in the financial system and have always taken stringent proactive steps to promptly resolve any such issues.

Regarding the recent illegal fund withdrawals, investigations have revealed that bank users usually fall prey to the above scams mentioned: the first one by the use of SMS to entice a victim to part with his account number in order to receive “cash winnings” often with reference to ongoing consumer contests, and the second, through “phishing” which tries to dupe online banking users to part with their security pin via fraudulent internet banking websites designed to capture vital details from victims.

Of late, the majority of the illegal withdrawals of funds is SMS-related. It is also important to note that a victim of this scam may only lose his or her funds weeks or even months after revealing sensitive details to the scammers when funds become available.

Investigations have revealed that the SMS fraud modus operandi generally takes the form as follows:

1. Victim receives an unidentified SMS stating he or she has won a cash prize and needs to call a stated mobile number to claim the prize.
2. The respondent on the mobile number will then prompt the victim to undertake an ATM transaction in order to be eligible for the prize.
3. This ATM transaction involves the usage of the ATM card into the machine and inputting the ATM number, after which the victim is told to open an internet banking account using a pin number provided by the fraudster.
4. The fraudster will then ask for the victim’s 16-digit ATM number under the pretext of helping the victim log into the internet banking site for the first time – this enables the fraudster to gain access to the victim’s bank account via internet banking.
5. The victim will then be asked to create a second authentication pin number which will also be requested by the fraudster for “verification” – this step allows the fraudster to keep checking the victim’s bank account periodically from then on (with the help of the ATM card number) and empty it of funds.

Dato’ Sri Abdul Hamidy also urged the public to follow two simple guidelines to ensure that no fraudster or syndicate gets access to one’s bank account, as most cases usually reveal negligence on the part of the bank customer.

Firstly, never divulge bank account number to a third party via the internet or by way of SMS as banks do not undertake such an exercise nor authorize third parties to do so and secondly, never reveal internet security pin codes either via email, SMS or phone call.

“Just by following these two simple rules carefully, the public will be able to safeguard their bank accounts and scammers will be out of business,” he stressed adding banks, as a rule, quickly respond to protect the customers’ interests upon public alert of these activities.

Banks, working closely with the relevant authorities, have been pro-active in shutting down “phishing” websites with the cooperation of the Malaysian Communications and Multimedia Commission (MCMC) as soon as public complaints are lodged.

Dato’ Sri Abdul Hamidy said that the banks can react more effectively to stop any fraud if the public reports any anomalies regarding requests for bank accounts numbers as soon as possible and not wait several weeks or months before doing so.

Bank customers can always contact the relevant bank itself, ABM, the Financial Mediation Bureau and or BNM for assistance and intervention.

Back to top