Be Careful With Bank Apps
Virtually every large bank and many regional banks and credit unions have rolled out applications that allow their clients to use a mobile phone for fund transfers, bill payments and even depositing checks. But with the increasing popularity and convenience of mobile-banking apps comes a big caveat: the risk of downloading and installing a fraudulent application that could draw your account information and, potentially, any other data stored on your mobile device. In other words, the next generation of “phishing” scams is about to explode – and it has the potential to do much more damage than earlier versions.
The trend is still in its infancy, but there have already been instances of potential fraud. In December, Google pulled 50 applications from its Android Market in response to concerns that they may be malicious. All apps were uploaded by the same developer and claimed to offer access to bank accounts from a wide variety of institutions, from big names like JP Morgan Chase, HSBC, US Bank, USAA and ING Groep to local credit unions.
“Smartphones are extremely prolific right now and there is opportunity there for criminals to be seeding stores with applications intended to capture personal information,” says Nick Holland, a senior analyst at market-research firm Aite Group. “We’re on the tip of an explosion in terms of bad apps.” Even more worrisome, fraudulent apps may be more difficult to spot than was the case with the fake web sites used by “phishing” scammers. An unusual web address, or URL, could easily flag a web site as fake, but that’s not the case with smartphone applications. And the fact that an application is available through an app store gives it an aura of credibility, says Holland.
