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Phishing Expedition Set To Enter Second Phase

The next chapter in the battle against phishing focuses on defining technical and operating requirements for banks, investigating technical anti-phishing approaches, and deploying customer education and enforcement.
Banks are mad as hell, and they're not going to take it anymore. Angered at the impunity with which initiators of phishing attacks are able to mimic their brands and steal customer identities, they're entering phase two of a three-phase counterphishing initiative, involving defining technical and operating requirements for banks, investigating technical anti-phishing approaches, and deploying customer education, enforcement, and other industry initiatives.

The counterphishing effort is being conducted by the Financial Services Technology Consortium, an industry group. Phase two, to be formally kicked off at a meeting of the consortium's Security Standing Committee next month, will focus on creation of a pilot for testing the effectiveness of anti-phishing methods identified during phase one, which was launched in July. These include educating customers, outfitting customer desktop PCs with anti-spam-protection software, and working with law-enforcement authorities and Internet service providers to identify and stop phishing attacks while they're in progress. "People are learning to be more effective at identifying phishing attacks and shutting them down," says Chuck Wade, head of the counterphishing initiative.

The consortium next month will release the results of a survey of technology vendors on proposed anti-phishing solutions.

The problem is pervasive and pernicious, involving an unholy alliance of identity-theft rings and spammers. "Phishers are leveraging built-up infrastructure for both spam and credit card fraud," Wade says.

Phase three, expected to be launched in mid-2005, will introduce means of monitoring and deploying additional countermeasures, Wade says.

The effort is intended to create a road map that all banks can use to fight phishing attacks, says Michael McCormick, system architect at Wells Fargo & Co. and co-chair of the consortium's security standing committee. Eleven financial institutions have signed on to the project.

Phishing attacks have been growing at the rate of about 50% a month, according to the Anti-Phishing Working Group, a software industry association. About half of all attacks are aimed at financial institutions; in July, some 1,600 attacks were perpetrated against the financial-services sector, including 682 against Citibank.

According to the Anti-Phishing Working Group, a software industry association, 5% of phishing E-mails succeed in obtaining customer IDs such as Social Security numbers and passwords, which can then used to create phony credit-card accounts through which thieves steal thousands of dollars each.

Banks are talking to ISPs about the need to block outbound as well as inbound spam and are partnering with vendors of anti-spam software to deliver fraud-prevention tools to customers' desktops. One such vendor, Cloudmark Inc., is announcing next week that it's enabling banks to white-label its fraud-detection service, SpamNet, and provide it free to customers.