Editorial
A stitch in time
After it came to light that an international criminal ring is involved in stealing PIN numbers and passwords and withdrawing cash from ATM booths in Nepal,After it came to light that an international criminal ring is involved in stealing PIN numbers and passwords and withdrawing cash from ATM booths in Nepal, the Central Investigation Bureau (CIB) of Nepal Police has urged all ATM card users to change their PIN codes as soon as possible.
The police on Friday arrested three Romanian nationals in Thamel with Rs 308,500, Euro 10,905, Philippine Peso 470, a Swiss watch worth about Rs 2.5 million and a set of equipment used to steal data, including false ATM keypads, false card slots and hidden camera sets.
According to the CIB, earlier the gang stole PIN codes from foreign countries and withdrew cash from Nepal, but now they have begun stealing Nepalis’ PINs. Moreover, the fraudsters may have already transmitted Nepal’s PIN codes to their international crime partners. Hence the security alert.
It is a good idea to pay heed to the CIB’s advice. Although Nepal Investment Bank Limited, whose ATM the criminals stole money from, has claimed that the bank has adopted maximum security to safeguard depositors’ savings and assured that those who lose money would be compensated, the process to recuperate the losses is likely to be long. It would be far easier to change one’s PIN and minimise the risk. Data from the Nepal Rastra Bank (NRB) show that there are around 4.8 million electronic cards in Nepal.
The crime is at least partly the result of the financial institutions’ failure to comply with the NRB’s directive to replace the traditional magnetic strip cards with the more secure, but costlier, chip-enabled cards. And the crime is not an isolated incident. The central bank had issued the directive last year in response to a few crimes of a similar nature. A couple of large commercial banks have introduced chip-enabled cards, but have not installed ATMs that can read them. Still, the central bank has taken no action against non-compliance. Financial institutions cite high costs for the delay in making the switch. International criminal rings seem to be taking advantage of the country’s out-of-date technology and lax regulations.
Failure to comply with the NRB’s directive is therefore likely to lead to more serious crimes in the future. The latest incident highlights the growing threat of electronic crimes in a cyber age. Better technology, more vigilance and stricter enforcement of regulations are required to prevent them. In the meantime, electronic card holders should take some basic precautionary measures to minimise the risk of being a victim of electronic crimes. For example, they should change their PIN codes regularly and opt for SMS alert service from their financial institutions. Prevention is better than cure.