SA police arrest man in Absa Net bank fraud case

26/07/2003 Written by John Leyden

South African police have arrested a man on sus­pi­cion of the fraud involv­ing the ille­gal trans­fers of hun­dreds of thou­sands of rand from Inter­net accounts held at Absa, the country’s largest bank.

The case involves the unau­tho­rised removal of R500,000 (£41,300) from bank accounts run by an esti­mated ten sep­a­rate Absa cus­tomers in South Africa’s West­ern Cape province.

A man in his 30s, from the Cape Town area, was arrested by police in con­nec­tion with these offences yes­ter­day, ITWeb reports. Charges are yet to be made. A fur­ther state­ment on the case is expected from police tomor­row (Sat­ur­day, 26 July). Offi­cers from the West­ern Cape com­mer­cial crimes unit are lead­ing the inves­ti­ga­tion.

Mean­while, despite been crit­i­cised for its han­dling of the prob­lem ear­lier this week, Absa said it had signed up an extra 1,273 new clients in the past four days. Absa has 405,000 Inter­net bank­ing clients.

“This proves that our clients are loyal to Absa and know that Inter­net bank­ing is safe,” said Alfie Naidoo, Man­ag­ing Exec­u­tive Absa e-​channels.

“We would like to thank our clients for stand­ing by us dur­ing the inves­ti­ga­tions. The growth in new reg­is­tra­tions shows that the pub­lic trust the Absa brand.”

Of course, the inci­dent doesn’t prove the bank’s Inter­net accounts are safe — in fact it’s evi­dence of the oppo­site. Nonethe­less you got to hand it to Alfie for the brass balls in try­ing to spin such a line, and (in fair­ness) the bank deserves credit for stop­ping most of the fraud­u­lent trans­ac­tions and reim­burs­ing its clients for monies lost.

Absa says its own sys­tems are secure and blames the prob­lem on secu­rity mis­takes by its clients. Police are work­ing on the the­ory crim­i­nals used “spy ware” to gain access of vic­tims’ PCs to swipe Inter­net bank­ing infor­ma­tion and trans­fer money out of their accounts.

In response to this, the bank has reis­sued guid­ance on steps Inter­net bank­ing clients can take to help pre­vent their dig­i­tal cre­den­tials get­ting swiped (click on link from Absa’s front page).

Accord­ing to Absa, only three client accounts were affected by the raids but since the secu­rity prob­lem first came to light ear­lier this week addi­tional peo­ple have come for­ward to the South African media to report they too have been affected. The closely watched inves­ti­ga­tion is rapidly becom­ing a touch­stone case for the future of e-​banking in South Africa.