September 23, 2019 – E-transfer fraud is more common than assumed. In fact, thousands of dollars are stolen by e-transfer fraudsters. CBC’s Go Public reports of 56 people who have fall victim to this scam, their total losses are $64,000. The victims experienced struggles trying to get the lost funds reimbursed by their bank, like advertised. Banks refer to their terms and conditions where it is stated that people who don’t use a strong security question, are not protected.
Canadians lose thousands of dollars to e-transfer fraudsters. CBC’s Go Public informed about 56 people who reported to the news segment that they lost almost $64,000 while using e-transfer. Although most banks advertise with security guarantees while using their online services, their clients experience struggles when they ask the financial institutions to reimburse the lost funds. The banks base their rejection on the common terms and conditions – the fine print – where they attach conditions to their proclaimed digital banking security guarantee such as using a strong security question.
TD bank explains on its prevention website that ‘E-transfer fraud occurs when a third party is able to intercept an email money transfer and correctly guess or obtain the password.’ Unfortunately, fraudsters hacking into email accounts can happen to anybody, especially people, who have been affected by a data breach. In the bank’s terms and conditions or online agreements, they hold customers accountable while using their online banking services.
According to these bank agreements, customers must use tough security questions with unique answers which cannot be guessed or which are easy to find out. Answers to obvious security questions can often be effortlessly discovered by fraudsters on social media. The problem for customers who fall victim to e-transfer fraud is that if they did not use strong security questions, they are not protected and most likely won’t be reimbursed for their stolen money by their bank.
The customers who claim to have lost money to e-transfer fraud are feeling misled by the marketing of their banks according to CBC’s Go Public. Financial institutions often advertise with ‘security guarantees’ or that customer’s transactions are ‘fully protected’ but avoid talking about the risks of online banking and customer’s responsibilities.
Besides using strong security questions, it is recommended not to send the answer to the security question in an email and to protect email accounts that are used for online banking. Two-factor authentication and changing passwords regularly are security measures that help protect people from those kinds of online fraud.
