LEGAL PERSPACTIVE: PHISHING THREATENS E-BANKING & E-BUSINESS by AbdelGadir Warsama, Legal Counsel

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Dr AbdelGadir Warsama, Legal Counsel

Phishing, this relatively new electronic crime, refers to luring techniques used by identity thieves to “fish” for personal information in a pond of unsuspecting internet users. It is a general term for the creation and use by criminals of e-mails and websites that have been designed to look like they come from well-known, legitimate trusted businesses, financial and government agencies. These disguised criminals deceive internet users into disclosing their bank and financial information or other personal data such as usernames and password…etc. Phishing continues to be regarded as one of the most rapidly growing classes of identity theft scams on the internet that is really causing both short-term loses and long-term economic damage. Recent data indicates that criminals are increasing the number of consumers who have suffered credit card fraud, identity fraud, and financial losses. Estimated losses from phishing are billions of dollars worldwide and those losses are growing. An urgent action to combat this threat is required.

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Depending on the type of fraud that a criminal commits with the aid of stolen identifying data, individuals and business may lose anywhere from few hundred dollars to tens of thousands of dollars. Phishing also poses a particular threat because techniques used are constantly evolving. For example, “vishing” which is one of the forms of phishing involves identity thieves sending an e-mail designed in the same way as a phishing e-mail, yet instead of providing a fraudulent link to click on, the e-mail provides a customer service number that the client must call and is then prompted to “log- in” using account numbers and passwords. Alternatively, consumers will be called directly and told that they must call a fraudulent customer service number immediately in order to protect their account.

 Spear phishing, also, is a technique whereby e-mails that appear genuine are sent to all the employees or members within a certain company, government agency, organization or group. Much like a standard phishing e-mail, the message might look like it comes from an employer or from a colleague who might send an e-mail message to everyone in the company, in an attempt to gain log- in information. Spear phishing scams work to gain access to a company’s entire computer system. The financial sector is the most heavily targeted for phishing schemes and this network spreads to cover all leading banks and financial institutions as well as small entities and no one is protected from this new electronic crime going all around the globe and crossing boarders without being noticed. The short term effect of these scams is to defraud individuals and financial institutions. It has been noted that in some phishing schemes, criminals were able to convince up to at least 5% of their recipients to respond to their e-mails, resulting in a significant number of consumers who have suffered credit card fraud, identity theft and financial loss.

Due to the seriousness of this e-crime and the threats to all e-transactions, we believe that a strong legislative framework is required for combating identity theft and other methods used to that end as phishing and vishing. Criminal codes and internet regulations should be revised with the intention of defining and punishing such endless new e-crimes from fraudsters, intruders and trespassers.

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