Group of Banks Pushes Mandatory Registration Of Mobile Phones In Phl To Avoid Fraud And Identity Theft
According to an executive of the Bank of the Philippine Islands, it is very difficult to track devices that are not registered in case of online fraud.
As digital transactions become the new normal amid the pandemic, the Bankers Association of the Philippines (BAP) is now pushing for mandatory registration of mobile phones to avoid cybercrimes such as fraud and identity theft.
Although they do their part to catch scammers, Ramon Jocson, vice chairperson of BAP cybersecurity committee, told “BusinessWorld Live” on One News on Tuesday, Nov. 16, that they need help to be more effective.
Jocson, who is also the executive vice president and chief operating officer of Bank of the Philippine Islands, disclosed that they still have a lot of anonymous devices in the system at this time, and it is “very hard to track them” in case of fraud.
He said this is because until now, mobile phones in the Philippines are not registered.
The BAP also expressed support for the government’s national identification (ID) system. “If both of [those] are established, at least you're assured that everybody participating in [the] system is a trusted entity.”
According to the e-Conomy Southeast Asia (SEA) 2020 report by Google, Temasek and Bain & Company, with the pandemic necessitating mobility restrictions and contactless services, 37% of digital service consumers in the Philippines were new to digital services.
Jocson cited phishing, identity theft, as well as ransomware attacks targeting small firms as some of the scam incidents during the pandemic.
Phishing is the fraudulent practice of sending emails purporting to be from reputable companies in order to induce individuals to reveal personal information, such as passwords and credit card numbers. Ransomware is a form of malware that encrypts a victim's files.
“As transactions become more convenient to do, it also opens up opportunities by which people can sort of disguise themselves… in the value chain. By doing so, they disintermediate the flow of funds and redirect it, of course, to themselves,” he said.
Scam incidents increase
Jocson bared that the number of scam incidents have increased threefold since the pandemic.
“Before we have around I guess, in a month, we would have around 200 to 300 clients who are scammed, we are now seeing close to around 900 to 1,000 a month,” he revealed.
He also stressed that these scam incidents would continue to rise as criminals have become more sophisticated. “It will continue to go up as digital adoption goes up.”
Most of these attacks are not technological in nature, according to Jocson, adding that criminals also include “age-old methods of diversion” in their modus operandi.
He noted that scammers would pretend to be articulate and try to speak well so people would trust them easily. As a result, victims would inadvertently divulge personal information such as their credit card and bank account details.
Unlike before where criminals used to attack automated teller machines or ATMs to get money from the bank, Jocson noted that criminals now shifted their focus on going after individuals as it is easier for them to use that tactic than getting through bank's defenses.
He said banks already installed “sophisticated systems” to detect unusual behaviors like hacking so “we know if we're being hacked or if there are anomalies in our systems.”
“Banks have established or installed what we call cybersecurity operation centers which essentially track all movements in the bank and also putting more defenses so it’s harder to hack the bank,” he explained.
According to Jocson, the BAP is working with lawmakers in Congress to strengthen cybersecurity law because “the current laws we have on cybersecurity do not criminalize certain aspects of the act” and “phishing is not defined.”
“So when you catch somebody doing phishing, you bring them in front of [a] judge or prosecutor, you have a hard time trying to describe what the crime is all about,” he stressed.
For the clients, Jocson said they installed systems to give them different levels of authentication when they do a transaction. This means, apart from their clients’ credentials, they also require them to input a one-time password (OTP) or mobile key generated from OTP generator and registered in the bank.
“All credit card transactions in all funds transfer transactions require this multi-factor authentication process,” Jocson emphasized.
He said their group, in partnership with media organizations, launched a “cybersafe campaign” to raise awareness among their customers.
“It's really about awareness, information campaigns which tell clients about what to avoid about what to divulge, what approaches they should be wary about in case somebody asks them for information,” he added.
Seamless payment transactions
On Tuesday, PLDT, Inc., the Philippines’ largest fully integrated telecommunications company, and its wireless unit Smart Communications, Inc. announced that they are utilizing the anti-fraud solutions of Vesta to enhance the protection of online transactions made by customers across their digital channels.
PLDT’s financial technology arm PayMaya Philippines acquired Vesta’s anti-fraud tools that provide the analytics and authentication technology required to increase approvals of legitimate transactions, while rejecting bad ones.
PayMaya powers the payment acceptance for PLDT and Smart’s digital channels.
Through the initiative, PLDT and Smart customers can enjoy “safer, more secure, and more seamless online payment transactions” using PayMaya’s payment acceptance solutions, with Vesta’s anti-fraud tools.
This would also ensure that PLDT and Smart customers can confidently make payments across various digital domestic and international channels.
PLDT and Smart customer experience vice president Di Blanco said through the use of artificial intelligence and machine learning capabilities, it would allow them “to deliver superior customer-centric services and provide our customers with the best payment experience possible.”
“We will continue to push the frontier of financial technology as we rapidly shift to a landscape where more Filipinos are digitally-empowered,” Blanco said.
A recent survey conducted by Vesta found that one in three consumers across Southeast Asia has experienced online fraud.
The survey also noted that roughly a third of all shoppers in the Philippines specifically rank safety and security as their top concern when it comes to e-commerce.