Bank Agrees to Reimburse Hacking Victim $300K

[HardOCP News]

A bank forced to reimburse a customer for money lost to hackers? Wow, this has to be a first.

“This case says to banks and to commercial customers … that there are circumstances in which the bank cannot shift the risk of loss back to the customer, and we’re not going to assume that security procedures are commercially reasonable just because the bank has a system that they say is state of the art,” says attorney Dan Mitchell, who represented Patco.

 

[sfsuphysics]

$45k in interest over 3 years on $300k? Holy shit I want in on that bank, loving the 0.25% interest my bank offers me... oh yeah and this is for accounts exceeding $50k not a $200 account.

 

[Crosshairs]

Kind of a bogus ruling....

People’s United Bank has agreed to pay Patco Construction Company all the money it lost to hackers in 2009, plus about $45,000 in interest, after intruders installed malware on Patco’s computers and stole its banking credentials to siphon money from its account.

If the bank were hacked, I would say they are responsible...but this guy got himself hacked.....that's not the banks fault at all...

 

[CappyCobra]

Kind of a bogus ruling....
If the bank were hacked, I would say they are responsible...but this guy got himself hacked.....that's not the banks fault at all...

Not saying the company is not partially at fault here but.

Strike 1: Patco generally only made transfers once a week on Fridays ( unauthorized transactions were occurring outside normal patterns/hours)
Strike 2: The most it ever transferred was about $36,000 (Most of the fraudulent transactions were made in amounts exceeding $90,000)
Strike 3: initiated from different IP addresses (normally issued from the same IP)

At the VERY minimum, the bank should have put a hold on and verify with the account holder:

1 - All transfers to first time recipients,
2 - Transfer amounts outside of normal averages.
3- New IP addresses

 

[OldBuzzard]

Not saying the company is not partially at fault here but.

Strike 1: Patco generally only made transfers once a week on Fridays ( unauthorized transactions were occurring outside normal patterns/hours)
Strike 2: The most it ever transferred was about $36,000 (Most of the fraudulent transactions were made in amounts exceeding $90,000)
Strike 3: initiated from different IP addresses (normally issued from the same IP)

At the VERY minimum, the bank should have put a hold on and verify with the account holder:

1 - All transfers to first time recipients,
2 - Transfer amounts outside of normal averages.
3- New IP addresses

This...plus this from the article

... Patco had argued that the bank’s authentication system was inadequate and that it failed to contact the customer after its automated system flagged the transactions as suspicious ...

 

[SoulHunter]

It's pretty sad when my Blizzard account and Steam account are safer then a bank account. It's time for these institutions to get with the times, passwords are a very weak form of protection.

 

[Tudz]

$45k in interest over 3 years on $300k? Holy shit I want in on that bank, loving the 0.25% interest my bank offers me... oh yeah and this is for accounts exceeding $50k not a $200 account.

It's about 4.75%, I have one account that over the past 3 years has averaged about 4.5%... of course it's not an American account, which probably only would have averaged 0.25%

 

[T_A]

Internet banking would collapse if security to your money could not be guaranteed
The bank must pay or people would lose confidence in the system
and this means less online transactions and more people arriving to the bank (which would require more branches and lots more manpower )

 

[BoogerBomb]

The bank should sue the construction company for allowing the construction companies systems to be compromised resulting in the banks system being unlawfully accessed.

 

[sfsuphysics]

It's about 4.75%, I have one account that over the past 3 years has averaged about 4.5%... of course it's not an American account, which probably only would have averaged 0.25%

Yeah because the Fed is giving nearly free money to the banks the interest rates have been in the shit hole. Saw a "staggering" 1.01% rate on a 10year CD the other day... *sigh* seems banks are only useful to be a middle man for all of your electronic transactions

 

[haste.]

Try a credit union. We are paying much higher than .25%. Hell we pay 2.99 on checking account balances up to 10k.

The bank probably didn't have proper authentication setup and is dodging a lawsuit. A few years ago regulation was introduced that required multi step multi factor authentication for online banking.

 

[infojunkie]

It's pretty sad when my Blizzard account and Steam account are safer then a bank account. It's time for these institutions to get with the times, passwords are a very weak form of protection.

You sure about that Bliz part?

 

[Crosshairs]

The bank should sue the construction company for allowing the construction companies systems to be compromised resulting in the banks system being unlawfully accessed.

Thats how I see it also, but it seems we are in the minority here ....its not the banks responsibility to make sure this dumb ass keeps his computers clean....

Internet banking would collapse if security to your money could not be guaranteed
The bank must pay or people would lose confidence in the system
and this means less online transactions and more people arriving to the bank (which would require more branches and lots more manpower )

except the bank does not pay...you and I do...with higher fees and less interest on our money....Im not sure about you, but I dont like paying for other peoples mistakes....

 

[Trepidati0n]

Thats how I see it also, but it seems we are in the minority here ....its not the banks responsibility to make sure this dumb ass keeps his computers clean....

True. However, you can get hacked pretty easily these days unless you are ultra paranoid and well versed on the hacking trends. My MIL a couple days ago got whacked by the Antivirus virus. The newest variants look "really fucking good". Which site did she go to...a website with cooking recipes that got hacked.

Secondarily, since everything is computer driven, even simple things that don't make sense can easily be acted upon. It isn't like the old days when you had a savings book. Banks have gotten smarter with 2-form authentication though which is a cheap and simple step in the right direction. We do need to get some laws changed to require that incoming texts be free so all transactions can easily be sent to a phone. For people without wizbag gadgets (e.g. they just have a dumb phone) cheap alternates can be provided.

 

[likeman]

We do need to get some laws changed to require that incoming texts be free so all transactions can easily be sent to a phone. For people without wizbag gadgets (e.g. they just have a dumb phone) cheap alternates can be provided.

the bank should of stopped the money and called them up on that First 100K that was sent 2 Factor or Not (security Answer is not 2 factor, it's just an Second password)

,
I always found that odd in the USA you get Charged for receiving an Text message that is just stupid money making, the bills you could get from just some one Spam Bombing you (i hate to be an PAYG user there)

is it only an US exclusive thing as anywhere els in the world you get charged for Sending text but not receiving, even when your Roaming out side of the network to receive an text is free

the way should work is the Sender Pays for sending the text the receiver should never get charged,
as the Sender should of been charged already for that person to receive the text, as the Network who sent the message pays nearly nothing to send the message, if its not there home network, like Sending Text from AT&T to Sprint would be a guess 0.01$ to cross the networks, if it was Sprint to Sprint the cost to send that would be practically nothing

do you get charged for receiving calls as well?

 

[dr.kevin]

Even credit card companies have better security than this. They always call you with suspicious transactions.

Most people are not that computer literate, so you have to give them a pass.
With all the app downloading, people can easily get a trojan. So really, the burden should lie with the bank.

 

[TheCAD]

It's pretty sad when my Blizzard account and Steam account are safer then a bank account. It's time for these institutions to get with the times, passwords are a very weak form of protection.

Everyone who has an even relatively large sum on poker sites gets a security key(high volume players often get them for free), yet I've never heard of a bank offering anyone one.

As far as I know not many banks have them and if they do they aren't using them enough.

 

[krotch]

Wow, this bank blows. My bank acct gets locked so many times throughout the year. In the past 2 months, I've used my debit card from Maryland to Idaho (and states inbetween the two). Acct, locked. Had to call to have unlocked.

Then a week later, went from Idaho, Minnesota, Amsterdam, and Germany in 1/2 a day. Acct locked again. Luckily, my bank has branches in Germany, so just walked in and had unlocked.

I'm not going through a bank, but a credit union. They seem to care about customers more. I'm with 2 credit unions now.

 

[CappyCobra]

Wow, this bank blows. My bank acct gets locked so many times throughout the year. In the past 2 months, I've used my debit card from Maryland to Idaho (and states inbetween the two). Acct, locked. Had to call to have unlocked.

Then a week later, went from Idaho, Minnesota, Amsterdam, and Germany in 1/2 a day. Acct locked again. Luckily, my bank has branches in Germany, so just walked in and had unlocked.

I'm not going through a bank, but a credit union. They seem to care about customers more. I'm with 2 credit unions now.

Sooo you're annoyed at the bank being overzealous of protecting your $ instead of under? If I were running a bank and saw that, I would lock your account too. Did you notify them PRIOR to going on that trip? I'm guessing you didn't.