Internet Banking Security Issues

Risks of Online Banking

Although Internet banking is loved by most, there are certain drawbacks that come along with it, and this includes certain legal issues. After all, there is a lot to learn about when it comes to Internet banking, and although it can save you time and money and offers a lot of convenience for the most part, at the same time it is important to protect yourself from potential pitfalls, and Internet banking is certainly not without its flaws.

Online Banking

Before you can really be able to understand the disadvantages and privacy issues involved with Internet banking, you need to understand Internet banking itself and the different types. Basically there are two different methods through which Internet banking can be conducted: a personal computer and wireless technology. Most people use a personal computer to conduct their online banking tasks, however there are many people that opt to instead complete banking services via wireless technology, for instance through a PDA or cell phone.

Online Privacy Issues

There are various different legalities that are involved with Internet banking, namely privacy issues. After all, even though a website may claim to be completely secure, there are literally hundreds of thousands of hackers out there who are just waiting for someone like you to logon so that they can hack in and steal your personal information. Especially if you check your account balances and complete other banking duties online frequently, regardless of the stated security of the site, you still need to be worried about potential hackers and other threats.

There are so many different issues revolving around privacy that you have to take into consideration with Internet banking. For instance, your financial institution may want to share some of your personal information in order to help market particular products that you are using, and this can often be without you even knowing. Although they do have policies regarding what personal information they can collect and use, it is often in very fine print and it is very seldom that anyone actually ever takes the time to read it.

This can mean that not only is your personal information being entered into the computer every time you logon to your online bank account, but as well it can be being given right out into the open by your own bank. Your bank is required to provide you with a copy of their privacy policy, which is not as important if you are using an actual bank but absolutely critical when using Internet banking services.

Cookies are also important to learn about here, and Internet cookies are programs that Websites put on your hard disk, and which then sit on your computer gathering various information about you and everything that you do on the Internet. Each cookie file is a very simple, normal text file, and you can see which Website placed each cookie on your machine by looking at the file name.

Identity Theft

Identity Theft refers to the collection of someone else's personal information with the intent to commit a crime. As of January 2010 it is a criminal offense to possess another person's identity information for criminal purposes.

Identity Fraud

Identity Fraud is the actual fraudulent use of another person's identity information to commit a crime by impersonating that person.

Technology, mainly the internet, has opened the door to more sophisticated means of identity theft such as skimming, phishing, and hacking of personal computers to gather personal information of potential victims.

Skimming is an electronic method of capturing a victim's personal information for the purpose theft. A skimmer is an electronic device that scans a credit card and stores the information contained in the magnetic strip. This can happen during a regular credit card transaction, often when your card is out of your sight. This information can then be used by an identity thief to make purchases or withdraw cash in the name of the actual account holder. To prevent this happening to YOU always keep your credit, debit and ATM cards within view while making these type of transactions.

Phishing scams are attempts by fraudsters to steal personal information for financial gain. These unsolicited emails or texts request account numbers, passwords or other personal information from recipients and often request an immediate response or account will be closed. Fake emails like these are even made to look like they come from legitimate companies like banks or businesses. Do not fall prey to these scammers!

Hackers - Computer hackers pose a serious threat to identity security. Viruses can be spread to your computer which allow hackers to gain control of your computer and steal any information you have stored on it. Wireless networks can be breached and hackers can use malware to figure out your username and password to gain control of your computer. To help prevent this happening to YOU make sure you have anti-virus and anti-spyware installed on your computer and it is kept up to date. Do not enter personal information in surveys or on websites that look suspicious.

Victims of identity theft or fraud can experience financial loss as well as difficulty in securing credit, and restoring their "good name".

How to Prevent Identity Theft