Are 'Phishing' Losses Overstated?

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TowerGroup estimates that direct fraud losses attributable to phishing were $137 million in 2004, a figure far below levels that are often cited, according to US BANKER.

TowerGroup predicts that phishing attacks, where criminals try to get people to give out their account information by imitating web pages of real businesses to steal money, will rise to 86,000 this year from 31,300 in 2004.

While the losses remain slow, the danger is the loss of confidence and the possibility that the development of online banking and e-trade may be slowed, TowerGroup said.

The US BANKER story ran just pages before an ad by Fiserv promoting identity theft protection. The Fiserv ad claimed that the Federal Trade Commission estimates that last year 10-million Americans were victims of identity theft. Consumer losses amounted to $5 billion while the direct cost to business, including financial institutions, was $47.6 billion, it said.

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