News

S Korea makes a move to foil phishing scams

June 13, 2012

South Korea's top financial regulator, the Financial Supervisory Service, said Monday that the country would implement a delay in the availability of wired funds as a means to stem consumer losses from email and phone phishing.

As of June 26, it will be impossible to make an ATM withdrawal of a wired amount of 3 million won ($2567.40) or more until at least 10 minutes after the money has been credited to the account, said an article in the Korean Herald.

"The new system is aimed at buying time for financial authorities to suspend the accounts of voice phishing scammers," an FSS official told the Herald.

In phishing cases, a fraudster emails or telephones a victim pretending to be a relative or other trusted source in need of emergency funds — typically requesting that the funds be sent by wire. In the vast majority of cases, the money is withdrawn by the thieves within 10 minutes of its being sent.

"Most victims realize they have been duped immediately after wiring the money, but in about 75 percent of the cases, the money was siphoned off within 10 minutes, making it difficult to reduce damages," the official told the Herald.

The report said that more than 90 percent of legitimate money transfers are for less than 3 million won, while 84 percent of phishing requests were for 3 million won or more. 

For more on this topic, visit the security research center.