Report: SWIFT Discloses More Attempts at Cyber Thefts

data breach fraudSWIFT, a Belgium-based, bank-owned co-op and provider of financial messaging services, said this week that criminals attacked the technology infrastructure of member banks even as the group sought to tighten up security in the wake of an $81 million cyber theft of Bangladesh Bank, according to an Aug. 31 report from Reuters.

The news agency, citing a private letter that SWIFT sent to clients, said the organization had identified an undisclosed number of cyber attacks, “some of them successful,” since June. That’s when SWIFT was updating its members on the Bangladesh theft. SWIFT’s messaging services, which transmit billions of dollars around the world, are used by more than 11,000 financial institutions in more than 200 countries and territories.

“Customers’ environments have been compromised, and subsequent attempts (were) made to send fraudulent payment instructions,” said the letter reviewed by Reuters. “The threat is persistent, adaptive and sophisticated—and it is here to stay.” The letter also indicated that some targeted entities lost month but no other details about the attacks were released.

SWIFT has set a Nov. 19 deadline for members to deploy new software designed to prevent such attacks.

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CFPB: Prepaid Complaints Continue Decline in July

CFPB_mailboxPrepaid card-related complaints to the CFPB ticked down in July, the bureau announced in its latest monthly consumer complaint report. The month saw 211 complaints about prepaid products, down 5 percent from 223 prepaid complaints in June and slightly below the monthly average of 215 since the CFPB began tracking prepaid complaints in July 2014. July 2016 also marked the second consecutive month of declining prepaid-related complaints, following a one percent drop in June compared to May.

For the three-month period from May to July 2016, the bureau received an average of 219 prepaid-related complains a month—an 18 percent jump over the same three months of 2015. Despite the increase, prepaid continues to comprise a small percentage of overall consumer complaints to the CFPB. Since the agency began maintaining its complaint database in 2012, just 5,608 of the 954,424 total consumer complaints it has received dealt with a prepaid issue—that’s just over one-half of 1 percent of all complaints.

In this month’s report, the CFPB focused on bank accounts and services—about which the agency has handled 94,207 consumer complaints since July 2011, or about 10 percent of all complaints received since that time. Bank accounts and services ranked as the fifth most-complained about category, trailing closely behind credit card-related complaints, at 99,175. The most commonly cited consumer issues with bank accounts and services were problems with account management—which comprised 45 percent of complaints in the category—and issues with deposits and withdrawals, at 26 percent. Checking accounts were the subject of 64 percent of complaints, while just 6 percent of complaints dealt with savings accounts.

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Study: Mobile Banking, Payments Growing But Still Face Barriers to Further Adoption

Ever-improving mobile technology is not only changing how consumers are paying for goods and services, but also is transforming mobile banking, which has evolved from simply viewing bank balances and statements to paying bills, transferring funds between personal accounts and making P2P payments, among other functions. More consumers are using mobile banking, however there are obstacles to further adoption that present opportunities to financial institutions, according to a new report by global provider of financial services technology Fiserv Inc., “Expectations and Experiences: Consumer Payments.”

Of the 40 percent of respondents who used mobile banking within the 30 days prior to the survey, more than half reported using the service more now than they did the prior year. The study also found that 51 percent of respondents said mobile will change the way they bank, 44 percent said mobile already has changed the way they bank and 41 percent of millennials (ages 18 to 35) said they “would leave their wallet at home if they could store all of the information they need in a digital wallet they could access and use anywhere.” The online poll, conducted by Harris Poll on behalf of Fiserv, surveyed 3,048 U.S. adults who have a checking account with a financial institution.

Although usage and interest of mobile banking and payments has increased overall, millennials are a main driver of this growth with 87 percent reporting using mobile banking. The study also highlights the growth of mobile among late millennials (ages 25 to 35)—their usage of mobile banking since last year increased 60 percent, mobile bill pay use increased 56 percent and use of a digital wallet increased 57 percent compared with last year.

For all the growth in mobile banking and payments that the study indicates, there are still hurdles to clear to further increase adoption: security concerns with mobile banking features and lack of awareness that such mobile banking features exist or not knowing how to use them.

Nearly 65 percent of respondents who don’t use mobile banking are leery about security when accessing banking information on a mobile device. Thirty-five percent of consumers who don’t use bill pay and nearly 30 percent of P2P nonusers don’t use these features out of concern for online security and protecting their personal information.

More than 40 percent of respondents reported not knowing their FI offered P2P payment services, and 45 percent didn’t know their FI’s bill pay service offers the ability to receive or view bills online. What’s more, some consumers aren’t using certain banking features because they don’t know how: P2P payments (24 percent), mobile banking (20 percent) and bill pay (14 percent).

Lack of mobile banking awareness or know-how among consumers is one of the biggest barriers to adoption, but also “presents an enormous opportunity for financial institutions to educate customers about the availability of products, their security features and general functionality of digital payments services” according to the report.

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P2P Firm TransferWise Seeks to Move Beyond Banks

3d-Earth-Globe-icon_300pxTransferWise, a five-year-old P2P firm based in the U.K., plans to “scale back” its reliance on banks as it expands, according to an article in the Wall Street Journal.

Instead, the company will seek to gain its own financial licenses, which would require TransferWise to do its own anti-money laundering and criminal checks of customers but also allow it more freedom than available now through its bank partnerships, according to the report. For instance, the company has run into hurdles in the U.S. because of state-by-state financial regulations that govern money transfers; New Hampshire earlier this year sanctioned TransferWise because it did not have an in-state presence, a move that required the company to repay at least $16,000 in customer fees.

The company has attracted top investment. Last year, for example, venture capital firm Andreessen Horowitz led a $58 million funding round for the firm. The company said it has customers in more than 50 countries.

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People on the Move: Trent Sorbe, CFPB

sorbe_trentVeteran financial services professional Trent Sorbe has accepted a two-year appointment to the Consumer Financial Protection Bureau (CFPB)’s Community Bank Advisory Council (CBAC). Sorbe has more than 20 years of experience in the financial services sector and currently serves as president of Central Payments, the payments division of Central Bank of Kansas City. The CBAC aims to provide interactive dialogue and exchange of ideas and experiences between community bankers and CFPB staff, with CBAC members proving general advice on the bureau’s regulation of consumer financial products and services. Sorbe will join other members from across the country and provide information, analysis, and recommendations to better inform the CFPB’s policy development, rulemaking, and engagement functions. Brad Fauss, president and CEO of the Network Branded Prepaid Card Association, recommended Sorbe for the position.

Sorbe’s appointment to the advisory council is his second engagement with the CFPB. In October 2015, he was a member of the bureau’s small business advisory panel, testifying on the impact of an agency proposal to prohibit use of class action litigation waivers in arbitration agreements used for consumer financial products, such as credit cards and prepaid cards.