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Banking & Finance

SBV warns banks about fraudulent payments

Released at: 18:01, 30/08/2016

SBV warns banks about fraudulent payments

Photo: Duc Anh

Central bank issues a number of directives to guarantee security at banks regarding financial transactions.

by Duy Anh

The State Bank of Vietnam (SBV) has warned organizations providing online payment services to bolster their safeguards against fraudulent payments, which have plagued some banks in recent months.

In Official Statement No. 6466, SBV Governor Le Minh Hung demanded units enhance their confidentiality and privacy controls to minimize the risk of fraudulent transactions and to protect the rights of customers.

Organizations providing payment services need to review and assess their entire payment processes, policies, documents and open contracts.

For card and electronic payments, organizations providing payment services must research and develop solutions to enhance security and confidentiality.

For transactions exhibiting questionable signs regarding time, location and frequency, organizations providing payment services must have solutions in place to detect, supervise and address such transactions. They also need to look at the number of incorrect verifications and payment limits, among other unusual signs in transactions.

There must be solutions in place to quickly detect misleading online website notifications and improvements to knowledge regarding safety and confidentiality among employees and customers using online banking services.

Organizations are also required to regularly track and supervise, assess and complete technical procedures for payments and must not skip stages in technical procedures.

Moreover, when fraudulent transactions occur, organizations must notify the SBV immediately while at the same time coordinating with customers and relevant authorities to handle such situations quickly and ensure the rights of customers under law.

The Vietnam Bank Association (VNBA) needs to conduct research and publicize information via the media about fraudulent methods used in payment activities through card and electronic payments so that banks and customers can be alert and adopt solutions to ensure safety and minimize the possibility of fraud.

The Association must also hold conferences involving international and domestic experts to publicize the latest fraudulent methods as well as solutions to improve safety and confidentiality in payment activities.

The Banking Supervision Agency under the central bank and SBV branches in cities and provinces need to add content regarding the supervision of information technology (IT) in payment activities into their inspection programs, conducting regular reviews to enhance the supervision and inspection of payment activities.

The Agency is also required to regularly cooperate with the Vietnam Information Technology Agency to update information on fraudulent methods and direct organizations providing payment services to raise their alertness and cooperate with relevant authorities in preventing and fighting criminal activity.

In the first week of September the SBV will hold an industry-wide video conference about payment activities and IT matters. Participants include representatives from the Ministry of Public Security (MPS), the Ministry of Information and Communications (MIC), the SBV, the VNBA, commercial banks, international organizations, and banking and IT experts, among others.

The conference aims at strengthening the State’s control over payment activities and IT within the banking sector, to complete technical procedures and operating processes in payment activities. There will also be discussions on security solutions and confidentiality to guarantee the safety and effectiveness of payment activities at banks and ensuring the rights of customers.

In recent months customers of Vietcombank have reported money being stolen from their accounts. One customer reported losing VND500 million ($22,410) on August 4, followed by customers reporting losses of VND17 million ($760) on August 16 and VND10 million ($450) on August 19.  

A customer at the Vietnam Prosperity Bank (VPBank), Ms. Tran Thi Thanh Xuan, reported losing VND26 billion ($1.16 million) from her company’s account since July 2015. According to her letter of complaint sent to MPS, her company’s accountant along with VPBank employees conspired to illegally steal funds from the account. Authorities, though, are still investigating the incident.

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