The Financial Information Protection Association, a newly formed bank trade group, issued a stern warning Friday about government- sponsored attacks on financial information systems.

The warning stemmed from allegations that computer hackers had been authorized by the United States government to meddle with bank accounts held by Yugoslavia's President Slobodan Milosevic.

The allegations surfaced in the May 31 issue of Newsweek.

Kawika M. Daguio, executive vice president of Financial Information Protection Association, said the practice, if it is confirmed to have happened, could set a dangerous precedent.

"When governments try to hack into banks for any reason, they send dangerous ripples through financial networks and across national boundaries," he said.

"Financial cyber-warfare damages public confidence in the global financial system, establishes a bad precedent and, moreover, invites retaliation and emulation." Mr. Daguio said.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.