Over 20 percent of banks in the Middle East region were victims of phishing and pharming during the last one year, according to a global online transactional security survey. The survey conducted last month by Singapore-based ReadiMinds - a specialist new generation transactional security and fraud prevention software product company and provider of leading edge software solutions for the financial and securities industry - revealed that awareness levels of the impact of online security incidents was still quite low amongst Middle East banks with 75 percent of the respondents unaware of online security incidents in their own organizations. Over 70 percent of banks still did not have dedicated budget for online security. Online security was still part of the IT budget. The survey primarily focused on Middle East's major banks across United Arab Emirates, Bahrain, Saudi Arabia, Lebanon and Kuwait and covered issues pertaining to transactional security and risk mitigation, online identity theft, MITM attacks and online financial frauds. Operational risk, also called transactional risk, still do not attract enough importance in the financial institutions compared to credit and market risks. This however is changing with new regulatory guidelines, result of alarming increases in identity theft, and online financial frauds including external and internal frauds. “Financial crime surveillance slowly but surely is gaining ground. Identity management and fraud prevention, and risk management, are the top two security agendas for 2008 for the Middle East banks,” the survey said. Stronger user authentication - software based two-factor authentication methods, namely phone factor or device fingerprinting - was gaining ground over the traditional one-time pin generating hardware security devices, because of lower cost and user convenience. “Over 30 per cent of respondents now preferred it for their new implementations - a growing trend among the financial institutions.” All respondents were aware that integrating stronger user authentication with fraud detection and risk-based transaction authorization was the strongest form of defense against online identity theft, MITM attacks and financial frauds. Over 30 percent respondents now prefer integrated solution for their new implementations - fraud detection and risk based transaction authorization together with stronger user authentication, for transactional security and fraud prevention.
